GRR - Grange Resources

[Erlang]

I bought GRR several months ago, and I can't believe my luck. I keep thinking it's going to come back down. But their P/E is still a reasonable number.

I imagine that producing iron pellets instead of just iron ore is a major plus.

But if I wanted to be critical, GRR does just have one operating mine site in Tasmania -- they're co-developing another one in WA, but who knows when that will happen -- I believe. Also, isn't their main shareholder (a Chinese steel company) also their major customer?

 

[Smurf1976]

But if I wanted to be critical, GRR does just have one operating mine site in Tasmania -- they're co-developing another one in WA, but who knows when that will happen

The other side of that is that if they go from one mine to two well that's 100% growth for the business if both mines are comparably sized.

Versus say BHP or Rio Tinto that would gain only a minor % increase if they were to add the same volume of production.

Also I'm not sure if it's still a plan but some years ago they had the idea of buying additional ore (from whoever) and pelletizing it. There's 5 furnaces at the pellet plant but only 4 in use so subject to shipping costs it might be another growth opportunity.

 

[mullokintyre]

Pretty good quarterly out for GRR.
Tonnage up.
Costs down.
Received prices up.
Free cash and investments well up.
Still managed to open 4.5% down.
methinks its just a perfect opportunity to add some more.
One of the interesting things I read, was that a section of Berm reinforcing was done using remote controlled equipment.
This is obviously the way of the future for all mining, especially where there is a higher level of potential danger to humans.
Next step will be to remove the human part on the remote control and just use AI.
Mick

 

[Erlang]

Well, now the market seems to also like the quarterly.

 

[mullokintyre]

Well, now the market seems to also like the quarterly.

Yeah, was a little slow in getting my order in and missed out on that early slump.
From the opening low of 765 it hit an intraday high of 8725.
Would have been a nice scalp for the day.
Such is life.
Mick

 

[qldfrog]

Yeah, was a little slow in getting my order in and missed out on that early slump.
From the opening low of 765 it hit an intraday high of 8725.
Would have been a nice scalp for the day.
Such is life.
Mick

Sadly, my system was out at 80c...but my investment packet made me very happy with the rebound?

 

[divs4ever]

The other side of that is that if they go from one mine to two well that's 100% growth for the business if both mines are comparably sized.

Versus say BHP or Rio Tinto that would gain only a minor % increase if they were to add the same volume of production.

Also I'm not sure if it's still a plan but some years ago they had the idea of buying additional ore (from whoever) and pelletizing it. There's 5 furnaces at the pellet plant but only 4 in use so subject to shipping costs it might be another growth opportunity.

GRR have another undeveloped project ( in South Australia in my memory is correct ) but are searching for a JV partner ( is it 5 years they have been looking ) , that is one reason they are stock-piling so much cash

the pellets were the preferred feed-stock of their major customer ( and former majority share-holder ) all very quirky but profitable along the way

i hold GRR ( bought between August 2012 and September 2014 from 39 cents down to 11.5 cents )

i primarily bought GRR and now delisted TMM as a hedge to avoid iron-ore disruptions the WA players faced during cyclone season

cheers

i hope this helps understanding a little bit about the company

DYOR

 

[divs4ever]

I bought GRR several months ago, and I can't believe my luck. I keep thinking it's going to come back down. But their P/E is still a reasonable number.

I imagine that producing iron pellets instead of just iron ore is a major plus.

But if I wanted to be critical, GRR does just have one operating mine site in Tasmania -- they're co-developing another one in WA, but who knows when that will happen -- I believe. Also, isn't their main shareholder (a Chinese steel company) also their major customer?

the official major shareholder has changed since i bought in , but that might mean the gentleman has retired from the board and put at least part of the holding in a trust . , did they get a partner ?? .. but yes in 2012 the majority holder was a Chinese Steel Company and sharing a director as you would if you own over half the company

i was looking for that in the quarterly , as a guide whether i should take out the investment cash ( and let the profits run ) , or leave the holding at full cash risk

 

[Erlang]

GRR have another undeveloped project ( in South Australia in my memory is correct ) but are searching for a JV partner ( is it 5 years they have been looking ) , that is one reason they are stock-piling so much cash

the pellets were the preferred feed-stock of their major customer ( and former majority share-holder ) all very quirky but profitable along the way

i hold GRR ( bought between August 2012 and September 2014 from 39 cents down to 11.5 cents )

i primarily bought GRR and now delisted TMM as a hedge to avoid iron-ore disruptions the WA players faced during cyclone season

cheers

i hope this helps understanding a little bit about the company

DYOR

Thanks for that.

They have an undeveloped project in Western Australia (they own 70% of it), not South Australia. But I believe it's in the south, far from cyclones.

https://www.theadvocate.com.au/stor...rice-is-right-as-grange-resources-ponders-wa/

 

[Erlang]

This link suggests it's near Albany.

https://www.mindat.org/loc-267201.html

The Southdown magnetite prospect in 90 kilometres north-east of Albany, and forms a 12 kilometre long linear east-west deposit, cut in half by the South Coast Highway. It is located on cleared agricultural land, and forms a low ridge, more prominent to the west. Magnetite outcrops in only a few places along the strike.

The deposit was discovered in 1983, by an airborne survey conducted by the Australian Bureau of Mineral Resources. Several companies explored the site during the 1980's. Tasmanian based Grange Resources acquired the site in November 2003. It conducted extensive drilling, feasibility studies, an

 

[divs4ever]

thank you for the correction

cheers

 

[Smurf1976]

This link suggests it's near Albany.

Being 1 hour's drive from an established town and with a highway running right to the mine site may have some advantages so far as costs are concerned.

At least it's not middle of nowhere etc.

 

[divs4ever]

in an area of less cyclone activity , you would have thought would help attract extra investment , but it seems not so

maybe GRR should test out Indian investment cash , and see if there are any nibbles there

 

[mullokintyre]

GRR had a big fall from its highs of late July, down 20+%. Mr market obviously see GRR being affected by the falls in raw iron ore prices and slow down from China.
Still an attractive dividend position, will hold for at leat until that happens.
Mick

 

[Dona Ferentes]

Magnetite stocks fell over when the last boom fell over (2011) and I suspect they will this time.

(Only saying this because there were a lot of them, and they mainly disappeared/ were subsumed) (to my detriment)

 

[qldfrog]

GRR had a big fall from its highs of late July, down 20+%. Mr market obviously see GRR being affected by the falls in raw iron ore prices and slow down from China.
Still an attractive dividend position, will hold for at leat until that happens.
Mick

my SL trigered at -15% from highs and I am out....

 

[Erlang]

For those still in the game, according to this website, Grange's Southdown project in Western Australia will start later this year:

Grange has scaled down its plans for Southdown to 5mn t/yr of high-grade magnetite from the 10mn t/yr project that was shelved in 2018 and prior to that in 2012. The firm expects to finish studies into the smaller project, which will produce magnetite concentrate to export to China and Japan, by the end of this year

https://www.argusmedia.com/en/news/2243072-grange-resumes-australias-southdown-magnetite-iron-ore

I am somewhat surprised. I hadn't read that it was starting so soon. And I am not familiar with this publication Argus. A reliable source?

 

[divs4ever]

i can't help on the reliability of Argus ( never heard of them before either )

but awesome news if true

i resisted reducing GRR in the recent rally

just keep in mind the extra mine will take a while to get into full production , which MIGHT be good news for the patient

DYOR

but on the flipside GRR often slips under the radar of the media

a quick look at the declared staff rings no bells ( warning or otherwise )

but always useful to have a second ( or third ) opinion source

cheers

 

[divs4ever]

the GRR Tasmania mine sells a fair bit of pellets , so scored a tailwind from the Brazil tailings dam disaster

i didn't so a reference ( so far ) of pellets being created in the WA project

 

[mullokintyre]

GRR still falling, so I obviously got this badly wrong.
Market obviously sees the pellet business being severely curtailed, and I thought the specialised Pellet business would sustain it.
Want to keep holding it, but the market has far deeper pockets than me.
So it will just have to go.
Mick