Okay, so there’s been more happening with the mining companies I watch/ invest in, and because this is as much a scrapbook of what I’m following I’m going to post about it, but rest assured next month is back to existential musing (working title ‘culture wars as a problem of thermodynamics‘).
I was very pleased with the 4x return (theoretically) on my Crowdcube holding of Cornish Lithium. But in actual legitimately traded stock news, my holding of Cornish Metals (yep, different company, see also British Lithium [private] and Cornish Tin [Crowdcube]) is pretty honking. Down 20%, and hovering near all time lows. I think this is off the back of the wider macro situation; people are bearish on commodities and miners, particularly exploratory guys like Cornish Metals, in the face of a wider tech slowdown and swirling recession impacting drivers for commodity prices like increased requirement of tin, copper etc for electric cars, chips and other wiring type stuff. I kind of buy this, but if anyone has a better explanation, or knows of a good write-up of one somewhere, I’m keen to read it.
This case doesn’t really put me off either. Per prior posts and the UK Critical Minerals Intelligence Centre, commissioned by UK Gov (1), in the long run global industry is going to need a lot more of these metals to meet demands for increasing westernised, high-tech living standards. The ongoing trend towards re-shoring/ right-shoring or whatever other spin you want to put on reversing decades of outsourcing to cheap, far-away, possible antagonistic/ non-western-aligned countries is also going to push towards European/ American sources of minerals for European/ American companies. See here the ongoing restrictions in Chinese exports of critical minerals (2). This problem isn’t going away IMO, leading me to be long-term bullish on mineral prices – and probably more widely inflation. McKinsey recently put out some statements about the growing potential for a copper supply gap (3), and I am convinced that the EV, renewable, middle-class development of the world is an inexorable tide now, so the question becomes is there enough institutional interest already to be pushing investment in copper, tin etc mines such that we end up with an oversupply. I think some institutions are bullish there aren’t and prices will go up, hence the massive investment into Cornish Lithium by TechMet et al (4).
Back to Cornish Metals, and the impact of the Inflation Reduction Act from the US, designed to help this sort of work, neatly laid out by Bloomberg…
They’ve also been pretty busy getting the South Crofty mine bloody working. The massive pumps have now started to de-water the mine (6). Once dry they can then continue further resource estimation and commence phases to begin trial production. A September press release already demonstrated 31.6% more tin in the latest estimates based on updated drilling (7). Once I’m back to passive/active weight spec I may well buy more of this stock, because I’m a glutton for speculation.
Elsewhere I’m sniffing around Anglesey Mining Plc (8);
Parys Mountain (small hill), on Anglesey where they’re speculating, is an absolutely bonkers post-industrial semi-wasteland, see here (9), and here (10). The whole hill was just one big pile of copper ore. Makes sense to go back there and see what the Victorians missed. I’ll be following them with interest as they update their inferred and indicated mineral estimates, and move towards full feasibility study status.
Finally, I’m continuing to watch Tungsten West (11), owners of the Hemerdon tungsten mine near Plymouth that was relatively recently operated by Wolf Minerals (12). Wolf went backrupt in 2018 when they couldn’t get the returns of tin and tungsten from the mine promised, and basically couldn’t make it pay. I’m skeptical about Tungsten West, especially given they recently had some press about needing a lot more cash runway to get the mine working and profitable, but we’ll see (13).
October 2023 Finances
These are taken, as always, from my Beast Budget spreadsheet. My salary has settled now, and with the increase resultant from more on-call demands in my new post I’m seeing a good sum every month available for saving. This month it worked out to savings rate of 46%, with an overall increase in my net worth of 1.3%. In my S&S ISA I bought some more Vanguard FTSE Developed World ex-UK, which seems to have been doing the square root of bugger all for a while. The main jump in my net worth comes as I fill my emergency funds. These sit at £1,000 held in my current account (in a pot at 3.25%), £9,100 in cash ISAs (of a target of £10k, earning 4.5%), and £3,100 in Premium Bonds (of a target of £5k). Could well be hitting my target for the emergency fund ISAs by the end of the year.
Goals:
Goals for October:
- Tick three things off the house DIY list – success
- Tidy and clear up the garden for the winter – failure
- Go through the grocery budget in detail – success
- Chase down NHS pension valuation – success
To deal with the first two points, I took a week off and stormed through a list of house DIY bits. With impending baby No2 we are now seriously looking at moving to upsize, so we went round the house again to make a list of what needs doing ahead of staging the house to sell. Pretty bloody awful time to sell, but the local market seems (in our postcode at least) buoyant. The weather conspired against me for the garden, as I took what weather windows I could find to do outdoor DIY over gardening. A job for next month.
On the last goal, I finally set up my NHS online pension account and got an updated valuation. This has gone down a lot, from £247k to £128k. This illustrates why I don’t include my NHS pension in my net worth calculation. The figure provided by the NHS pension scheme is an annuity equivalent to the benefits provided by my current defined benefit from my membership. As interest rates have shot up annuities have become a lot more attractively priced, so buying the equivalent of what I would receive has gone from a big figure to a smaller figure. I’ll keep a vague eye on this, but nothing to worry about.
On the budgets; pretty much every month this year I’ve been running over budget on the household grocery shopping. The current nominal budget is set at £220/month, which I derived from three years (2019-21) of expenses. That hides a bit of story. Way back in the early days (e.g. Jan 2019) of this blog I pulled a number out of the air – £300/month, and used this a budget. In August 2019 my job changed and my salary dropped by a quarter. We tightened belts and the budget moved to £200/month. It stayed there and I pretty much kept to it through 2019 and 2020. I re-calculated things in January of 2022, using the average of the 36 months of data from Jan 2019 to Dec 2021. That upped things to £220/month. But my annual total for 2019 was £2,400, for 2020 £2,500, for 2021 £3,000 and now for 2022 £3,400. Inflation and a growing family has had a big effect. Updating and using just the 24 months from Jan 2021 to Dec 2022, I arrive at an average of £270/month.
To be fair, we do tend towards buyer nicer food and eat well. Most of our meals are cooked from fresh, using organic ingredients. Some of that is shop bought, some comes from a local co-operative veg box scheme or the high-welfare multi-award-winning butchers. We spend £60-80/month in the butchers, £35/month on veg, plus £20/month on other ethical local deliveries. If I then spent £50/week on other shopping in supermarkets we’d be looking at around £330/month minimum. If I split the difference of my data-driven and hypothesis-driven approaches I hit £300/month, which seems a fair number to try to target. Based on this I probably need to re-look at all my budgets, so a job for November…
Goals for November:
- Tidy and clear up the garden for the winter
- Work through the rest of my monthly budgets and re-calculate
- Finish DIY to stage the house for sale
Budgets:
As compared to my four year back-calculated mean monthly spend:
- Groceries: September £285, October £440, budget £300 – Yikes
- Eating out & Takeaway: Sept £101, Oct £66, budget £50
- Transport: Sept £106, Oct £125, budget £330
- Holiday: Sept £0, Oct £0, budget £40
- Personal: Sept £58, Oct £175, budget £120
- Health: Sept £98, Oct 63, budget £150
- Misc: Sept £919, Oct £580, budget £215 – More baby stuff
- Work fees: Sept £148, Oct £473, budget £265
In the garden:
Cut the grass, harvested some pumpkins for Hallowe’en. Needs a proper tidy.
Other news:
Various vaguely interesting consumer market things happening. Next have bought Fatface (14). I like both these brands, which surely confirms my middle-aged slide. Six months ago a vegan mate was telling me how he thought most shops had massively over-stocked on vegan and veggie food, and that there were only one or two decent brands decent lots of new market entrants. If I was a smart man I would have shorted some of these companies. Alas I am not, so I just watch as Quorn and Beyond Meat lose money (15). There’s a great piece in the Guardian reviewing items bought from Temu (16). There are now very few things I hate as much as Temu. It is evidence of all that is wrong in the world. And fuck off with “shop like a billionaire”. Billionaires don’t ‘shop’. Absolute crock of shite.
In more meaningful news, hot on the heels of my speculation last month (what are you doing subconscious), here’s an article about China struggling to collect on it’s massive international loan book (17).
And if you want a window into the general fuckwittery that is medical administration in the UK, here’s an article going in detail into how doctors applying to the nationally administrated once-yearly route into training to be an anaesthetic consultant got royally shafted (18). Hint, some people were using vlookup in excel, while others were manually copy-pasting in results. They then screwed up telling people incorrectly they were unappointable, and told the wrong people! And guess what, those people are still in charge. Glorious!
Cheers,
The Shrink
References:
- https://ukcmic.org/reports/cmic.html
- https://fortune.com/2023/11/09/china-export-restrictions-critical-minerals-threatening-viability-ev-makers-forcing-innovation-gene-berdichevsky/
- https://www.mining.com/the-global-copper-market-is-entering-an-age-of-extremely-large-deficits/
- https://www.bbc.co.uk/news/articles/cjezvydnrezo
- https://twitter.com/bbgoriginals/status/1692194354331259026
- https://www.thetimes.co.uk/article/all-hands-to-pumps-in-cornish-tin-revival-qrg7j69rn
- https://cornishmetals.com/news/2023/cornish-metals-releases-updated-mineral-resource-estimate-for-south-crofty-tin-projectornish-metals-releases-updated-mineral/
- https://www.angleseymining.co.uk/
- https://copperkingdom.co.uk/mynydd-parys-mountain/
- https://en.wikipedia.org/wiki/Parys_Mountain
- https://www.tungstenwest.com/
- https://en.wikipedia.org/wiki/Wolf_Minerals
- https://www.plymouthherald.co.uk/news/plymouth-news/tungsten-west-needs-65m-plymouth-8688111
- https://www.bbc.co.uk/news/business-67105142
- https://www.theguardian.com/business/2023/oct/13/quorn-maker-supermarket-sales-marlow-foods-beyond-meat
- https://www.theguardian.com/money/2023/nov/09/shop-like-billionaire-bought-six-items-temu-app
- https://www.theguardian.com/world/2023/nov/06/china-worlds-biggest-debt-collector-as-poorer-nations-struggle-with-its-loans
- https://www.theregister.com/2023/10/12/excel_anesthetist_recruitment_blunder/