Analyst recommendation. Disclosure - I hold IVW and ECU (and GOG). ECU's secondary mention is better than no mention at all. IVW has, I believe, excellent potential for share price appreciation, just like ECU and GOG. The IVW story is excellent material for a business school case study. The "bird kill" was a drastic event but it has resulted in IVW developing a world class method for shipping lead concentrate. Worth some research.
$0 Lead Sector$0$0$0$0$0$0Follow the leader. While you may just associate it with your pencil (used to be lead now its graphite), lead is one of the best$0$0performing commodity on the London Metal Exchange (LME) this year and supply related issues appear to provide support.$0$0Since bottoming in December 2008 at US$0.38/lb, lead prices have rallied over 185% to US$1.01/lb (LME Lead price as of$0$0September 3, 2009). Lead prices have been driven up by threats from the Chinese government to shut down all the smelters$0$0because of thousands of children that have died. Official investigations in the Yunnan region of China following a spate of$0$0poisoning incidents are said to be threatening nearly 500,000 tonnes per year of lead capacity. This lead price rally is expected$0$0to continue as supply concerns persist. One way to gain exposure to lead is through Ivernia (IVW), the only lead pure-play.$0$0They had some issues in the past, but they are going to ship again in the third quarter. The company had some problems because$0$0of the containers they shipped the lead in were leaky and the lead toxins killed some birds at the port where they were being$0$0shipped. So the Government of Australia banned it, but now they’ve fixed the containers and are planning on shipping again$0$0soon. Also note, lead and zinc mines produce a substantial amount of annual silver production and many companies that have$0$0silver plays have significant leverage to lead and zinc. Silver may be the main driver for these companies, but a rising lead price$0$0will help drive earnings and cash flow. A list of junior silvers that offer leverage to lead, Silvercorp (SVM), Fortuna Silver$0$0(FVI), ECU Silver (ECU), Excellon Resources (EXN), First Majestic (FR) and Great Panther (GPR). We note Newalta$0$0(NAL) has also gained from the current lead rally. The company maximizes the value in certain industrial wastes through$0$0recovery of saleable products and recycling rather than disposal. Lead sales accounted for approximately 12-15% of NAL’s$0$0consolidated revenue in 2008.$0
