🔍
💰 How To Play The Biggest Commodity Supply Squeeze In History 💥 Best Nickel Stock To Buy Now? 🚀 - YouTube
Channel: Corns Investing
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Welcome back everyone and what a roller
coaster it has been in the nickel market,
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over the last few weeks. The situation may seem
to have calmed down at the London Metal Exchange
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with control measures being put in place, but the
nickel market tumult continues, as with many other
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commodities, nickel has become a victim of the
supply concerns brought on by the Russia-Ukraine
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war. And even Tesla’s CEO Elon Musk has said
nickel is the metal that he worries most about.
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And so with Russia being the biggest producer
with 16 per cent of the world’s high-grade nickel,
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there are concerns that supplies could be
disrupted by western sanctions on Moscow,
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which provides other opportunities and so there is
a lot to get excited about the future of Nickel.
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And so in this video, I briefly
share with you what drove this spike
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and also details of one top nickel penny stock
for your watchlist, which is well positioned to
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benefit from the Russian supplier gap,
given their high purity grade nickel.
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This scenario could be the perfect setup for
North American explorers … And so this junior
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nickel miner which is looking to capitalize on the
supply squeeze and rising prices that have been
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disrupting exchanges right now, is certainly one
you wouldn’t want to snooze on given the outlook.
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And please do me a favour to drop a
like on this video to spread its reach
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and hit the bell so you never miss out
on any of these gems from the channel..
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Also leave me a comment below on what nickel
stocks you’re current holding or are watching.
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So that said let’s get straight
into and see what happened.
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So the surge in Nickel prices came as Xiang
Guangda, the billionaire founder of world’s
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biggest producer of nickel and stainless steel,
Tsingshan Holding Group, was hit by margin calls
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and tried to close a wrong-way bet that nickel
prices would fall by purchasing London Metal
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Exchange(LME) contracts. And for the benefit
of anyone new to this term, margin calls are
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requests for extra cash to cover losses on
futures or ones positions across the market.
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The billionaire also known as the Big Shot, has
for months held a large short position on the LME
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through his company as over several months, the
tycoon had amassed a huge bet that the price of
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nickel would fall. Tsingshan actually started to
amass its short position at the back end of 2021,
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when prices started to pick up because of demand
from carmakers. But when the market moved sharply
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the other way following the invasion of Ukraine,
he was left exposed to losses of potentially
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billions of dollars. And also compounded by the
fact that he was under growing pressure from his
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brokers for extra cash to meet margin calls on
those positions, Xiang was forced to close some
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of his position by purchasing LME contracts. But
his buying only served to further push up prices
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which more than doubled, topping $100,000 per
metric ton for the first time on record, leaving
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Tsingshan facing billions of dollars in potential
losses and the exchange was finally forced to act.
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Yet even as Xiang is sitting on huge paper losses,
it doesn’t seem like he is about to give up on his
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bet as he has secured credit promises from
Chinese and western banks to meet further
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demands for cash from his brokers and may receive
support from Beijing to close his short position.
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The LME, which referred to the events as
“unprecedented,” then announced the suspension
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of trading in all nickel contracts, and canceled
all 5,000 nickel trades executed on the day,
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worth nearly $4bn and wiping out about $1.3bn
of profit and loss on the deals. And as you can
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imagine, this caused a lot of unease as not
only did the LME fail to manage the risks,
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but it also picked a side when
it should have been neutral.
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They actually stated that “One of their key
responsibilities is to serve the physical
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traders,” “If they allowed the trades to stand,
they would have to say that the price of nickel
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is $80,000-$90,000 and that would not seem
rational to the physical market..” CNBC also said
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this regarding LME actions. Really interesting
stuff. It should also be known that the owners
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of LME are Hong Kong Exchanges and Clearing
Ltd so clearly some common interests there.
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Tsingshan has sinced reached a deal with its bank
including JPMorgan Chase and Standard Chartered
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who have agreed not to close out Tsingshan’s
position or make further margin calls.
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The standstill agreement will give the two
sides time to hammer out a deal on a new secured
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credit facility that they can use for their
“nickel margin and settlement requirements”.
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Nickel is currently sitting at $35,000
per tonne but still up 117% on the year.
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So some uncertain times which creates
equally fantastic opportunities
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and one way to play the Nickel bull run is via
this top nickel penny stock, Fly Nickel Mining
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Inc (TSXV:FLYN) which we recently called at 63
Canadian cents per share but it is now sitting at
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55cents with a market cap of $33m. As mentioned in
our previous video on Fly Nickel, it is a newbie
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to the markets and having seen an explosion and
more than doubling its share price but it has
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steadily been giving away those gains so much
that it is now sitting up 37.5% on the month.
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As we know the ev opportunity is mostly long
term and so the beauty with plays like this
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is to appreciate their business outlook and if
it works for you you get in a the price which you
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like, as I personally loaded up on this one
once it had decent pull back hitting 50cents.
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So good opportunity to cost average in.. They also
applied for their shares to be traded on the OTCQB
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which remains subject to the approval but
granting this will increase their liquidity and
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institutional ownership. And if you’re looking for
a platform where you can trade Canadian and OTC,
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you want to check out IBKR Platform
from the link in the top pinned comment.
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Flying Nickel Mining Corp. is a premier nickel
sulphide mining and exploration company,
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advancing its 100% owned Minago nickel project
in the Thompson nickel belt in Manitoba, Canada.
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Their Minago nickel sulphide project
has outstanding level of nickel purity
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which is sits at 0.74% grade which is
high purity for their open pit mining.
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Their strong focus on the environment means
that the Minago project could potentially
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have the world’s lowest CO2 emission per pound
nickel produced. The Manitoba hydroelectric
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power (is only 1km away from Minago)
having 0.4% of CO2 emission intensity,
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compared to other power sources used to mine
and process nickel elsewhere in the world,
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which is significantly lower than other regions.
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And looking ahead for what could drive their share
price even further in 2022, they plan to complete
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their feasibility studies, commence dialogue’s
and agreements with commercial partners.
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And when you look at their
roadmap to commercialise by 2026
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which is just four years away, you begin
to imagine how aggressive this timeline is,
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given other sector peers are looking at
a 2029 timeline for commercialisation.
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Their Minago project is one
of the few open-pit optimized
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nickel sulphide projects in North America,
with an excellent nickel grade of 0.74%
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that is a pure nickel play. Minago is in
the Thompson nickel belt in Manitoba, North
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America’s second largest historic nickel camp
with excellent infrastructure. So the potential
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future Minago operation could possibly have one
of the lowest carbon footprints in the world
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as the Province of Manitoba is 97% hydro-powered,
producing concentrate for Class 1 nickel products
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that are an ideal fit for automakers’ green
EV initiative.” Some brilliant stuff here.
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So some very very interesting and mindblowing
prospects ahead for this penny nickel penny stock
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but only consider getting in if the price is right
for you and if you fully understand the risks.
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This video is not financial advice, a buy or a
sell recommendation, but is meant to bring some
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new and exciting penny stocks to your attention
for you to do your own research.. As always I
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would love to hear from you, so please let me know
your thoughts on these top nickel penny stocks in
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the comments section below and what other nickel
penny stocks are catching your eyes lately.
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And If you are new to my channel, please ensure
to subscribe and hit the bell so you are notified
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when I upload new videos. If you would like to
see more videos like this, please check out this
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video right here or this playlist right here to
watch equally insightful content from the channel.
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Thank you so much for being here and I look
forward to have you in my next video. Thank you
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