CLF is selling pellets in the US for $110 which is keeping VALE out of the US market. This is exactly what RIO and BHP is doing to VALE to keep them out of China. VALE has the one major problem, they don't have a real local market for their ore. VALE needs to buy out CLF and tie up the N. American market.
This should tell you something, since CLF won that lawsuit, it shows how valuable these long term contracts are. Also, MT extended their contract with CLF that tells you that MT interest is what is good for MT. They could be a serious buyer of any of CLF's assets that will benefit MT and not to "save" CLF. Honestly, sometimes you read into something that just isn't there.
MT is not interested in Asia Pacific, could be interested in Canadian operations for the transportation network. CLF needs to look to India to unload their coal assets. But all of this is immaterial, CLF needs to address the short position now.
Goncalves believes BL will be a valuable asset in the future as US demand will grow and US iron ore assets will be used up. CLF will be better off finding a 50% JV then selling the asset.
A better question is what about the Wabush deal, CLF had a deal before the vote and now it seems to be gone.
Does anyone realize that no one is developing new mines. Furthermore it takes 5 to 10 years to bring a mine on line. We are headed for a shortage of iron ore in the future as all of these existing mines start to slow down as reserves are used up and there will be a huge lag on bringing new mines on line.
Inventories and free cash flow will pay for this buy back, no need to get creditor's endorsement! Please review their income statements.
Have you looked at the balance sheet? $600 million in inventories, over $300 million in cash and generating positive cash flow with low iron ore pieces… you are a total idiot.
Other than announce a stock buyback, CLF has not done a single thing to take on the shorts. I really thought Casablanca knew the real problem before they took control, now I am not so sure. Drapkin was in the media several times before the vote, nothing since then.
They have done it in the past and nothing last forever. They should have learned it is better to conserve their resources and sell it for more than it is to rapidly deplete their resources and go through the expense of developing more mines in the future. Oh well, it is what it is.
I agree, Bob (Snmickersmack) is just part of the short attack game plan, just like Robert (the Sheepman).
He needs to make one attack against the short position a day.
Everyone is missing the point here, low iron ore prices will make buyers want to buy local mines as transportation cost can quickly eat up any margin there is. Chinese will want to buy Australian mines before buying something in Africa.