Kasbah Resources Makes Gutsy Currency Call

John Robertson

PortfolioDirect

Kasbah Resources had looked like one of the most likely candidates to proceed to mine development but, in a gutsy call by directors, has decided to postpone funding its Achmmach tin project in Morocco in anticipation of better tin prices later in 2015 and a better financing deal. Over the past 40 years, there have been no examples of large or prolonged rises in tin prices while the US dollar has also been going up (see second chart). The decision by Kasbah Resources directors has effectively transformed the investment proposition of the company from a tin mine development into a currency speculation. This is the theme in my Mining Journal column this week (VIEW LINK) Meanwhile, the company’s share price is at a crucial juncture (see first chart). Without a project go-ahead, the source of upside potential is harder to discern. Investment prospects will depend on how persuasively the company can put the case for a near term rise in tin prices (and, by implication, a weaker US dollar).


1 topic

John Robertson
John Robertson
PortfolioDirect

John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...

Expertise

No areas of expertise

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.

Comments

Sign In or Join Free to comment