How Will Lithium Supplies Meet Forecast Demands?

GUEST COMMENTARY: Many equity market and lithium industry analysts have seized on recent statistics for lithium supply and demand as indicative of long-term market trends. By Adrian Griffin managing director of Lithium Australia.

They see the rapid increase in hard-rock production, combined with a slower-than-anticipated uptake of electric vehicles (EVs), as a sure sign that the sky is about to fall in on the lithium price.

This position has led to forecasts of a glut in supply that will send the value of lithium, and the chemicals produced from it, tumbling fast.

Closer examination, however, reveals this to be far from the truth.

If global demand for lithium-ion batteries grows beyond the pundits’ wildest expectations, which it seems it may, then conventional sources of lithium supply simply will not cope with demand.

How then might ‘infinite’ lithium supply be achieved?

Unconventional sources will have to fill the gap.

But how, and when, such sources will be exploited are the fundamental questions.

The answers to those questions are not yet clear, as the sector remains captive to misinformation, misinterpretation and misunderstanding.

Culpable are corporates and governments – large and small – jockeying for a larger slice of what is anticipated to be a very large pie, the next global industry.

For example, while ‘experts’ debate the rate of uptake of lithium-powered vehicles, China fiddles with its EV subsidies.

Already, converters of spodumene – a common mineral rich in lithium – struggle to cope with adding capacity or planning future expansions. Yet we are told there is an oversupply of spodumene concentrates.

These are short-term aberrations, but as legislative changes pre-empt the banning of internal combustion engines around the world, it is apparent that any perceived oversupply of lithium may actually be short-lived.

Taking a longer-term view, some 3.5 million tonnes of lithium carbonate equivalent (a common measure of value employed in the lithium industry) will be required annually just to power the EVs needed to meet the legislative requirements in place from 2030 or thereabouts.

Factor in growing demand for lithium for energy storage and electronic goods and it becomes harder and harder to realistically envisage current and planned lithium operations meeting that demand.
So, where will the ‘new’ lithium come from?

Current mining expansion will not meet lithium demand longer term.

As mines mature, production will dwindle.

New mines targeting lower grades can fill demand gaps, but alternative sources of lithium may prove more attractive as genuine supply shortages put pressure on conventional production.

As Earth’s ‘throwaway society’ matures and (hopefully) develops a culture of custodianship for the planet, recycling will replace new materials as the preferred source of supply.

When the market matures to the point of product saturation, with continual expansion no longer required, demand for – and the recycling of – lithium will synchronise.

If that does occur, newly mined material will only be necessary to top up that regained through recycling.

Unfortunately, such a scenario seems a long way off, and if global population continues to increase by around 1.07 per cent a year (82 million people) it may never be realised.

In the meantime, an exponentially increasing demand for lithium will have the industry scratching its collective head about new sources of supply.

So, what might some of those sources be? Options include the following.

Seawater;
Geothermal and oilfield brines;
Spent lithium-ion batteries;
Lithium clays;
Spodumene tailings; and
Lithium micas found in pegmatites and greisen.

Let us explore each option.

Seawater contains lithium in very low concentrations (approx. 0.17 parts per million).

Due to the large volumes of water that would be required, evaporation ponds will not work commercially.

Also, seawater contains many other dissolved minerals, so traditional separation technologies would involve not only huge energy consumption but also fouling of the filtration media or regenerants.

If the recovery issues for seawater can be resolved, its commercial advantages will centre on location and its ubiquity.

In fact, exploiting seawater as a source of lithium could resolve much in the way of political uncertainty and security risks and in so doing enhance sustainability.

Geothermal and oilfield brines have been much studied, but their low lithium concentrations present processing challenges and, with oilfield brines, the expense of pumping from great depths. Japan and NZ have achieved geothermal brine success, but key US efforts have not.

In the UK, hot springs in old mine workings have been found to contain lithium and this potential source is being investigated.

Spent lithium-ion batteries – worldwide, enthusiastic adoption of lithium-ion batteries in huge quantities is causing great environmental concern, since once depleted most end up in landfill.

Presently, only nine per cent are recycled.

In Australia, the figure is less than three per cent.

Right now, smelting is the main means of recovering the metals these batteries contain, but the lithium is usually lost in flux or off-gas.

Research into lithium recovery through condensation of the off-gas from such smelting is currently underway, as is the development of more efficient recovery processes that will make recycling of lithium-ion batteries a potentially significant new source of lithium (as well as other energy metals).

Lithium clays, while low-grade compared to conventional hard-rock lithium deposits, are garnering attention.

Mexican deposits have been metallurgically assessed and future production from the region is anticipated.

Other lithium clay deposits – including in Nevada – contain both lithium and boron, but recovery from such deposits remains very energy-intensive.

Spodumene tailings – given the ways in which spodumene mineral separation circuits perform, and how commercial concentrates are produced, most pegmatite orebodies offer a relatively low lithium yield in terms of tonnes of ore mined.

Conventional conversion processes are energy-intensive and feed rates dependent on relatively coarse particle size, so much of the fine spodumene is discharged to tailings.

Emerging processing technologies, however, can improve recovery rates for both coarse and finer particles, thereby limiting waste and utilising material previously considered unsuitable for conventional lithium processing.

This represents a great industry opportunity.

Lithium micas are the world’s most abundant lithium minerals.

Lepidolite in particular is commonly associated with tin, tantalum and tungsten mineralisation.

When those elements are mined, vast quantities of lithium micas are currently discharged as waste.

Given that extraction and some processing costs are already covered, lithium mica waste streams become an obvious target for lithium production, but further processing innovation is required.

Adrian Griffin is managing director of Perth-based, ASX-listed lithium disruptor, Lithium Australia NL (ASX: LIT), which is building a business that integrates all aspects of the lithium supply chain, the aim being to ‘close the loop’ on the energy-metal cycle.

Adrian is available on 0418 927 658.

 

Australian Commodities In The Spotlight

COMMODITY CAPERS: According to the nation’s chief economist the prices of Australia’s major resource commodities have hit seven-year highs.

However, the news isn’t all good with prices most likely to drift lower due to less demand and growing supplies.

The Roadhouse takes a quick look at what our number one bean counter has to say about the fortunes of some commodities.

IRON ORE

The chief anticipates the iron ore price averaging around US$67 a tonne in 2019, mainly due to the supply shock suffered from the aftermath of the Vale Brazilian dam collapse lifting prices in the first half of 2019.

The impact of lower supply will be good for domestic producers, if the weather holds, and will be partly offset by weaker demand for seaborne iron ore, stemming from a slight decline in steel production in China.

Stronger seasonal steel production should support high iron ore prices through the middle of 2019.

Key risks to the outlook for the iron ore price include the trajectory of Chinese import demand, as well as a potentially larger than expected decline in Brazil’s production.

URANIUM

Uranium prices have been on the rise of late, increasing to an average of US$28.90 a pound in January, a healthy premium to its low point of US$18 a pound in November 2016.

Most of the increase took place in the second half of 2018, but prices continued to lift in early 2019.

“Very large inventories of uranium are still held around the world, and this is expected to act as a check on the recent price surge,” the chief said.

“However, prices are still expected to rise slowly, as pressure on inventories builds over time.

“A substantial number of projects were postponed or cancelled during the record run of low prices, which could lead to a prolonged supply crunch in the years to come.”

GOLD

Our economist indicates that gold prices are projected to rise by around 2.1 per cent in 2019, to an average US$1,326 an ounce (real terms).

This is to be driven by higher investor demand for gold as a safe haven asset.

Slower economic growth is forecast across all economies, both advanced and emerging.

With further interest rate rises in the US either delayed or unnecessary, the greenback is likely to weaken modestly, removing a key hurdle to higher gold prices.

“Over the five-year outlook period, gold prices are projected to rise around 1.6 per cent a year (real terms), to US$1,428 an ounce in 2024, supported by slowing economic growth in some major economies, weakness in world equity markets, and declining mine supply after 2020,” the chief said.

COPPER

Copper prices demonstrated signs of strength early in 2019, after a long period of decline during the latter half of 2018 due to US-China trade tensions producing a substantial fall in copper prices from a mid-year peak.

Copper prices have not fallen much since July, but there hasn’t been any great recovery on the horizon.

Prices at the end of 2018 were 15 per cent below the level at the start of the year, at just over US$6,000 these have lifted so far in 2019 but remain well below what market conditions would normally suggest.

NICKEL

Nickel prices fell below US$12,000 a tonne in the first quarter of 2019 after prices enjoyed strong demand in the first half of 2018, until the pesky US-China trade tensions reversed this strength in second half of the year, resulting in prices falling for six months in succession.

“Nickel demand is expected to rise steadily over the outlook period, growing from 2.3 million tonnes in 2018 to 2.8 million tonnes by 2024,” the chief said.

Nickel demand is expected to rise with electric vehicle production by 2022 once prices of electric vehicles start to come down and climate change-related incentives and penalties take hold around the world, causing an anticipated global electric vehicle uptake.

LITHIUM

Prices for lithium hydroxide peaked late 2018 before falling slightly due to global oversupply and a decline in prices in China.

Lithium prices are projected to drop further as inventories continue to build, but the chief expects this will likely reverse in later years as inventories start contracting in the 2020s.

“The removal of bottlenecks at the refining stage should start to improve market and price stability for lithium,” the chief said.

“Lithium demand will be driven by electric vehicle sales, which are expected to keep rising as their prices approach those of petrol vehicles.”

 

 

Gold Predicted to Continue Price Rise

COMMODITY CAPERS: According the Office of the Chief Economist, gold prices are projected to rise gradually over the next five years, to an average US$1,428 an ounce (2019 dollars) in 2024.

This is predicted to maintain gold’s status as a haven asset and in turn fuel investor demand over the short term as world mine supply declines from 2020.

In its March Resources and Energy Quarterly Report, our chief economist reported that world gold production is projected to fall after 2020, as some long and large established mine projects in Australia and other major gold producing countries reach the end of their life.

Global gold consumption is projected to fall after 2020, driven by falling central bank purchases and industrial demand, however the demand for jewellery in countries such as China and India is expected to offset this decline.

The value of Australia’s gold exports is forecast to peak in 2019–20 at nearly $22 billion (in 2018/19-dollar terms), driven by higher prices and export volumes.

Export values are projected to decline to $16 billion by 2023–24, due to lower domestic production and export volumes.

Australian gold mine production is forecast to increase by 6.8 per cent in 2018/19 and 6.9 per cent in 2019/20, reaching a peak of 346 tonnes in 2019-20.

The chief rattled off all the usual suspects, such as Northern Star and Evolution, but also had room for a special mention for Gold Road Resources and its Gruyere gold mine that is due to come on stream early this year with forecast annual production of 8.4 tonnes.

Delegates attending the RIU Sydney Resources Roundup in May will find there will be plenty of up and coming gold exploration plays to get their teeth into.

Breaker Resources NL (ASX: BRB)

Breaker Resources has been busy at the company’s Lake Roe project, 100 kilometres east of Kalgoorlie in Western Australia.

Drilling undertaken by Breaker extended the strike length of mineralisation at its Bombora gold discovery by 700 metres to 3.2 kilometres whilst enhancing its underground mining potential.

Breaker has continued drilling with four rigs in action to extend and upgrade the Bombora deposit, and to identify the outer limits of initial open pit mining to finalise an open pit Pre-Feasibility Study (PFS).

The company plans to update the existing 1.1 million ounce gold Resource in the June quarter that will include results from drilling the 700m of strike length which has been added since the Resource was last calculated.

After two years of resource drilling, Bombora remains open in every direction and new zones of mineralisation were still being discovered.

Cygnus Gold Limited (ASX: CY5)

Cygnus Gold has a portfolio of 100 per cent-owned projects in the Wheatbelt region of Western Australia.

The projects range in developmental stage from early exploration areas through to advanced, drill-ready targets where high-grade gold results were achieved in drilling by previous explorers.

Recent activity has been happening within the Stanley project, with drilling targeting the Kepler Zone.

Cygnus Gold identified the Kepler Zone via a detailed review of drillhole STRC0002, drilled in late 2018 that ended in mineralisation.

Resampling of the original mineralised intercepts returning encouraging results.

The Kepler Zone is adjacent to Cygnus’ shallow high-grade Bottleneck gold prospect and the drilling program will initially target a metadacitic rock unit that has only been lightly tested by deeper drilling at Bottleneck.

The drilling is targeting extensions to the McDougall South prospect along the Stanley greenstone belt where drilling intersected gold mineralisation associated with a zone of anomalous gold within a structural zone along the central Stanley fold structure.

De Grey Mining LTD (ASX: DEG)

De Grey Mining is running an exploration program focused on the upgrade and expansion of known resources, as well as in the discovery of new deposits at the company’s Pilbara gold project south of Port Hedland in the Pilbara Region of Western Australia.

De Grey Mining believes in the potential of the Pilbara gold project to define additional resource ounces along the existing 200 kilometres strike length of mineralised shears zones, throughout the 1,500 square kilometre landholding.

Exploration carried out by De Grey to date has entailed detailed shallow RC and diamond drilling of approximately 10 per cent of the shear zones around 100m to 150m, from which the company has identified approximately 1.4 million ounces of gold resources.

The largest deposit within the project are is the 6.37 million tonnes at 1.8 grams per tonne gold for 377,300 ounces Withnell deposit.

Recent drilling at Withnell continued to enhance its resource potential, returning:

LODE 1 (West)
8 metres at 20.11 grams per tonne gold from 168m, including 4m at 38.5g/t gold;

LODE 1 (East)
5.47m at 4.57g/t gold from 293m;

LODE 2
16m at 4.21g/t gold from 94m, including 1m at 29.3g/t gold; and

LODE
4m at 16.4g/t gold from 240m.

De Grey considers Withnell, along with the Toweranna and Wingina deposits to have potential to increase underground resources to positively impact the expanded 2 million tonnes per annum Pre-Feasibility Study (PFS) currently underway.

First Au Limited (ASX: FAU)

First Au is drilling at the company’s 100 per cent-owned Gimlet gold project, just outside Kalgoorlie in Western Australia.

First Au is following up a RC drilling program it completed in December 2018 and earlier aircore drilling that returned several strong high-grade gold intersections, including 4 metres at 393 grams per tonne gold from 52m.

Early results from the RC drilling outlined mineralisation over 400m of strike length encouraging FAU to begin work on a potential JORC Resource.

Although primarily focussed on targeting shallower oxide mineralisation, a decision to push the drilling deeper led to the claim of a new lode gold discovery, which appears open at depth.

 

 

Western Australia Climbs Fraser Institute Rankings

COMMODITY CAPERS: There was good news for Western Australian mining types in the Fraser Institute Annual Survey of Mining Companies for 2018.

This year the institute managed to evaluate 83 jurisdictions, compared to the 91 jurisdictions evaluated in 2017, 104 in 2016, 109 in 2015, and 122 in 2014.

Western Australia moved up from fifth in 2017 to take out second place on the survey’s top jurisdiction in the world for investment based on the Investment Attractiveness Index.

The Fraser Institute overall Investment Attractiveness Index is constructed by combining the Best Practices Mineral Potential index, which rates regions based on their geologic attractiveness, and the Policy Perception Index, a composite index that measures the effects of government policy on attitudes toward exploration investment.

The only jurisdiction to do better than WA was Nevada, which moved up from third place in 2017.

WA was the only Australian jurisdiction to rate a spot in the survey’s Investment Attractiveness Index top 10.

Narrowing the field to encapsulate Australia and Oceania provided Australian jurisdictions with more joy.

On this list WA took top spot with Queensland second.

Fiji prevented an Aussie trifecta by taking third spot pushing Northern Territory into fourth and South Australia to fifth.

New South Wales, Victoria, and Tasmania maintained some respect by finishing above The Philippines.

The Fraser Institute Policy Perception Index (PPI), which the institute describes as “A report card to governments on the attractiveness of their mining policies” provided some encouragement to local jurisdictions.

Victoria and WA both improved their PPI scores by more than 10 points this year with Victoria taking its ranking from 52nd (of 91) in 2017 to 43rd (of 83) in 2018.

Respondents to this year’s survey expressed less concern over Victoria’s political stability (-17 points), uncertainty regarding the administration, interpretation, or enforcement of existing regulations (-13 points), and the taxation regime (-11 points).

Western Australia enjoyed a big jump in its score and rank, moving up to 5th (of 83) from 17th (of 91) last year, as fewer respondents rated the state’s taxation regime (-23 points), political stability (-15 points), and uncertainty concerning environmental regulations (-12 points) as deterrents to investment.

New South Wales enjoyed an increase of eight points over last year, improving its ranking to 53rd (out of 91) in 2017 to 47th (out of 83) in 2018.

This year miners were less worried about trade barriers (-10 points), although they did have higher concern over the legal system (+14 points).

Despite an increase in the rankings, New South Wales is Australia’s lowest ranked jurisdiction when considering policy factors alone.

Comments from respondents regarding some of the local jurisdictions, included:

New South Wales

Frequent changes to policy, poor consultation with industry, and frequent changes to regulatory staff are concerning for investors.
An exploration company president.

Getting access to Crown Lands is much more difficult than accessing private lands, which poses challenges for investors.
An exploration company senior management.

South Australia

Poor and flawed legislation relating to the Mining Act (1971) is a major concern for investors. Although the legislation has been acknowledged as flawed by the government, no attempt is being made to address its deficiencies in the latest amendments.
An exploration company president.

Victoria

Victoria’s high electricity prices are a deterrent for investors.
An exploration company chairman.

Victoria’s moratorium on onshore gas exploration is a deterrent for investors.
A producer company with less than US$50M company president.

Western Australia

Western Australia’s environmental policies and permitting requirements are streamlined and easy to understand. In addition, well-documented environmental, economic, and social requirements create a positive experience for investors.
An exploration company other senior management.

Western Australia’s wonderful new data sets are stimulating exploration in the region.
An exploration company manager.

 

READ MORE HERE

 

AMEC Provides Blueprint to Government Hopefuls

COMMODITY CAPERS: As the country rapidly edges towards the next Federal election, the Association of Mining and Exploration Companies (AMEC) AMEC has compiled a wish list for whichever side of politics holds the reigns.

AMEC has basically provided a manifesto of what the next government should think about doing for the mining industry, so it can address the challenges it meets through increased mineral exploration activity (both greenfield and brownfield) and the cost of doing business in Australia.

“We are calling on the current Government and the Labor Party to commit to the several proactive and achievable recommendations contained in the Platform which are aimed at increasing exploration activity and reducing the cost of doing business,” AMEC chief executive officer Warren Pearce said.

The long-term health of the Australian mining industry has long been overlooked by successive governments who have failed to realise the difficulties faced by those companies operating on the smaller end of the spectrum.

The big end of mining town is acknowledged for its survival as it increases its overall mineral production, however, this is primarily based on greater exploitation of known reserves not new discoveries.

Although lobby groups such as AMEC continue to rattle the exploration chain, the truth is that Australia’s rate of mineral discovery is falling despite the fact there remains incredible prospects for further mineral discovery across the continent.

The equation is simple enough, without new discovery, Australia’s current production levels will begin to decrease, as existing mines exhaust their reserves and close.

New mines are needed to sustain current production levels just as new mine developments are needed to deliver increased employment and an economic dividend for the country.

“We need to be taking action now to increase greenfield minerals exploration for the benefit of future generations of Australians, and critical Government revenue streams,” Pearce continued.

“Research has shown that it takes on average around 13 years to go from discovery to production.

The big miners mine, but they don’t explore, basically exploration is outsourced to the juniors who punch way above their respective weight divisions.

Instead exploration investment by larger companies is usually spent on identifying developments within an existing reserve, leaving small companies to undertake the exploration and then swop in to purchase such an asset that suits its infrastructure needs when a resource is discovered or proven.

In this way, the existing market serves up new opportunities to large established companies, who consequently do not need to take the risk of greenfields exploration to reap the reward.

However, even this is now being challenged, with very few promising acquisitions available.

The high-risks involved in greenfields exploration makes it unattractive for private investment, which is understandable given roughly only 1 in 100 greenfields exploration projects ends up being a discovery that results in a working mine.

Larger Australian mining companies tend to operate established long-life projects making investment in ‘greenfields’ exploration extremely rare.

Australia’s level of discovery is dropping, and consequently its ability to develop new mines has significantly reduced.

AMEC hopes to see this trend dramatically changed.

“We will continue to work closely with the Government and the Opposition to discuss what needs be done for Australia to grow its mining and mineral exploration industry,” Pearce said.

“This recognises that a successful, sustainable and robust mining and mineral exploration sector creates jobs and economic and social dividends for the community and should be a priority for our political leaders.”

 

To read AMEC’s Federal Policy Platform FOLLOW THIS LINK

 

 

Federal Labor Makes Battery Play

COMMODITY CAPERS: Although the next Federal General Election is – at this stage – still months in the offing, it appears we can expect to witness a good deal of strange bed-fellowing going on in the meantime.

This was no more apparent than in the recent joint announcement by Labor Party MPs Kim Carr, shadow minister for Innovation, Industry, Science and Research; Jason Clare, shadow minister for Trade and Investment and for Resources and the Northern Territory; and Madeleine King, shadow minister for Consumer Affairs, Assisting Small Business, and Assisting for Resources.

It seems the shouts of the Association of Mining and Exploration Companies (AMEC) have resonated down the corridors of potential power and have been heard by those responsible for directing the attention of these MPs, resulting in the mining lobby group’s 2018 Report: A lithium industry in Australia: A value chain analysis of downstreaming Australia’s lithium resources. landing on their collective desks.

The report was commissioned by AMEC in January this year and called on the State and Federal Governments to seize the opportunity AMEC believes exists to ensure Australia can realise greater value from its wealth of battery minerals.

Carr, Clare and King declared that should their party be elected it will get behind Australia’s battery metal manufacturing industry.

The sentiment is to be praised, however, the promise came with the usual political reasonings to do such a thing being mainly to create Australian manufacturing jobs and adapting to a clean energy future…blah, blah, blah.

Finally, the triumvirate’s release got into the nitty-gritty of the issue, acknowledging Australia as the world’s biggest supplier of lithium as well as producing every metal needed to make a lithium battery.

“But we still send most of our battery metals overseas without local manufacturing getting much of the action,” they said.

Carr, Clare and King cited AMEC’s study, identifying that the need to develop capacity to store renewable energy, along with the growth in electric cars, and smart devices is estimated in the report to grow the global Lithium value chain from $160 billion in 2018 to $2 trillion by 2025.

“Australia should have a bigger slice of that pie,” the Labor MPs said.

They recognised the ability of Australian manufacturing workers to refine locally-sourced battery metals and make batteries onshore.

“We can be a country that makes more things,” they added, sounding more like our current Prime Minister than they possibly would like.

There are presently companies investing in Australia to refine battery metals and establish battery manufacturing facilities.

Such investments include BHP’s nickel refinery and Tianqi’s Lithium processing plant in Kwinana and the Sonnen battery plant in Adelaide and Energy Renaissance’s battery plant planned for Darwin.

The Western Australia, Queensland and the Northern Territory governments are actively developing their own battery metal manufacturing strategies, actions that have more than likely sparked the federal interest, realising that by being as an advocate, rather than an antagonist, of the mining industry, advancements benefitting all can be achieved.

This point was not lost on AMEC chief executive officer Warren Pearce.

“AMEC has been advocating to all Australian governments to take a leadership role to ensure Australia does not miss out on this opportunity,” Pearce said in AMEC’s response to the announcement.

“This is a modern nation building opportunity, a chance to secure a significant position in a new emerging industry for Australia in what will quickly become one of the largest industries in the world.

“This new industry will create thousands of skilled jobs for Australians.

“Both the Resource 2030 Taskforce Report, and the Chief Economist’s September 2018 Resources Quarterly Report clearly articulate the opportunity that exists for Australia.

“AMEC will continue to engage with both the Federal Government and Federal Opposition to ensure bipartisan support for these nation building initiatives.”

 

Website: www.amec.org.au

 

Why Gold is Approaching a Bottom

FRIENDS OF THE ROADHOUSE: Recent months have proven challenging for the gold sector, with trading momentum definitely on the negative side as speculators have sided with the US dollar. By Gavin Wendt

These pillars of global financial markets move inversely proportionately to each other – i.e. when one’s rising, the other falls – and vice versa.

Nevertheless, the key fundamentals with respect to gold at present still ring true and support higher gold prices. But why is this so?

Well firstly, recent price gyrations are predominantly related to short-term trading positioning, especially as traders have deemed the US dollar as the go-to safe-haven of choice whilst the current trade imbroglio gets resolved.

Inflation is already spiking, and trade tariffs and other factors will almost certainly accelerate the inflationary process.

Furthermore, US national debt is the elephant in the room and the inconvenient truth that nobody wants to talk about – and the only way it’s going to get smaller is if it’s ‘inflated’ away.

In essence, the recent sell-off is overwhelmingly a transient phenomenon that’s decoupled from any intermediate or long-term fundamentals, which potentially presents a compelling opportunity for investors.

Let’s remind ourselves about gold’s unique status and why it has been a staple of the world’s economic systems for thousands of years.

Gold is simultaneously both a commodity and a financial asset.

Central banks around the world retain gold as part of their foreign currency reserves.

During 2018, as in past years, governments have continued to be net buyers of gold adding to official sector holdings.

The two main accumulators of gold are China and Russia, whose gold stocks remain far below those of other leading nations like the USA and countries within the European Union.

Whilst the Chinese and Russian governments have done some light buying in the international gold market, the bulk of their reserve accumulation has come from their domestic production.

China is the world’s leading producer of the yellow metal, whilst Russia has considerable annual output.

Amongst all of this, I believe there are various factors that could set the stage for a gold price recovery over the coming weeks and months, which I will outline below.

Gold’s Role Undiminished

Precious metals like gold and silver do best in times of elevated inflation, because of their abilities to hold value, protect against currency devaluation, and provide investors with a safe-haven alternative to financial instruments like stocks, bonds, derivatives, and other fiat-based assets.

After all, gold and silver are time tested, trusted commodities, that have served as stable forms of currency throughout time, for millennia.

Whereas, “all forms of fiat currencies eventually return to their intrinsic value, which is zero.” – Voltaire, famous French enlightenment writer and philosopher.

This is effectively true, since organizations such as the Federal Reserve, the European Central Bank, and most other central banks can essentially create money out of thin air, continuously inflating the money supply in perpetuity.

In the modern age, this is done with little more effort than punching numbers on a computer screen.

In fact, only about 8% of the world’s ‘money’ is physical cash, and the remaining 92% are basically just digits in a computer program.

Fiat money continuously loses its value through inflation, whereas gold and silver move in the opposite direction, and once confidence in a fiat currency begins to be impacted, the value of a currency can drop precipitously, which would produce an enormous surge in precious metals.

This has occurred numerous times throughout history.

Instances of hyperinflation are not just limited to poor Latin American and African countries.

Hyperinflation-induced currency crises have struck about 55 times over the last century alone and have deeply affected economies of countries like France, Germany, China, and many others.

If you add up all the physical and digital cash in the world, also known as the M3 money supply, you would get an immense number of over $90 trillion.

Moreover, the global debt market is even bigger, with an estimated $215 trillion.

And if you consider the world’s derivatives market you get an insane figure ranging from $544 trillion to about $1.2 quadrillion.

Yes, that’s an estimated upper range of $1,200,000,000,000,000 worth of derivatives floating around the world.

So, where do silver and gold factor in all of this?

Well, all the silver in the world currently represents only about $15.5 billion worth of value at current price, with an estimated one billion ounces out there.

And all the world’s gold combined, an estimated 187,200 tons, represents a value of around $7.5 trillion at its current price.

These are some of the world’s most essential and valuable metals that are used widely in industry, jewellery, store of value, and for thousands of years were used as currencies.

In fact, it was just very recently, fewer than 50 years ago that the world was ‘decoupled’ from the gold standard.

All the gold and silver in the world currently represent only about 8% of the value that M3 fiat currencies have, and fewer than 1% if you consider all the debt and derivatives floating around the world.

But why is this important for gold and silver prices going forward?

Simply because there are far too many fiat-based ‘assets’ in the world relative to the intrinsic, real assets like gold and silver.

In addition, the number and ‘value’ associated with fiat-based assets continuously increases, thus so should the value of gold and silver.

In fact, this trend has been intact for many years, and there is no reason to believe it is going to stop.

Gold Outperforms Dow More Than 10-Fold Since 1970

This may come as a surprise to many people, but the price of gold was very stable for many years – almost 150 years actually.

From about the inception of the dollar in the late 1700s to 1932, the price of gold remained around $20 an ounce.

In 1933, gold got repriced to about $35 an ounce, and once the world’s monetary system became decoupled from gold in the early 1970s, the price began to rise drastically.

Since then, the price has appreciated by about 3,400% to its current price of roughly $1,225 an ounce.

By comparison, the DJIA and the S&P 500 are up only about 315% and 385% in the same time frame.

The explanation for this wide difference lies in the perpetual rise in inflation, immense levels of fiat-based assets and derivatives, combined with the continuous degradation of the dollar and other currencies.

The bottom-line is that there is only so much gold and silver that can ever be mined, yet, fiat money can be inflated to infinity.

Therefore, as global debt levels continue to rise, the inevitability of perpetual money inflation becomes inescapable.

The United States, as well as many other nations around the world, has enormous levels of debt.

There are many countries out there with significant, problematic debt loads, but for the sake of simplicity we will focus on the U.S. alone.

The U.S. national debt currently towers at around $21.27 trillion, about 105% of GDP.

Moreover, U.S.’s personal debt is now over $19 trillion, total debt recently eclipsed $70 trillion, and total U.S. unfunded liabilities are over $114 trillion now.

This a problem because since 2000, the U.S.’s GDP has expanded by roughly 112%, whilst over the same period the national debt has exploded higher by about 325%, personal debt has grown by 134%, and total debt has increased by 168%.

It is clear that debt growth is significantly outpacing the growth of the economy.

In addition, since 2000, the M1 money supply (monetary base) has been increased by 505%, M2 money supply has grown by 193%, supply of U.S. treasuries has exploded by 596%, and derivatives have grown by 512%.

These are drastic increases over the past 18 years and are indicative of substantial money manipulation designed to inflate the global monetary supply.

Therefore, it is not a coincidence that the price of gold has increased by nearly 400% since 2000.

As more fiat-based financial assets flood worldwide markets to support the current financial status quo, gold and silver have risen.

This trend is very likely to continue and should accelerate going forward.

The U.S.’s debt burden is essentially unsustainable, and the national debt will only get bigger with time.

Right now, the Federal budget deficit is close to $800 billion.

This means you can add about another $800 billion to the $21.27 trillion national debt in roughly one year from now.

Moreover, Trump tax cuts, infrastructure spending, and other efforts to “grow the U.S. economy”, will likely cause the Federal budget deficit to blow out to over $1 trillion in future fiscal years.

The kicker here is that debt doesn’t come cheap, and the U.S. is required to pay interest to service its national debt.

We know that the U.S. already pays about $500 billion annually just in interest to service the gargantuan national debt.

But in this rising rate environment coupled with a continuously increasing debt load, the U.S. will pay more, much more.

Just by simply applying a 3% interest rate (which is very close to the current 10-year and an appropriate benchmark for national debt servicing), we arrive at an annual figure of about $640 billion.

It seems clear that with the enormous Federal budget deficit, and the perpetual debt servicing, the national debt only has one way to go, and that’s a lot higher.

Trade War Threat

There is a lot of talk about the current trade tensions in the world, especially in regard to U.S. and China.

In addition, gold and silver seemingly declined on news of further tariffs imposed on Chinese goods and vice versa.

But are trade tariffs negative to the overall inflationary narrative? In fact, the opposite appears to be true.

For instance, the U.S. has now slapped tariffs on hundreds of billions of dollars’ worth of Chinese goods entering the U.S. each year.

This means that the underlying goods will now cost more for U.S. consumers.

In conjunction, new higher priced competing products coming in from other producers, domestic and foreign will also be more expensive.

Producers will also pay higher raw material prices for steel, aluminium, oil and so on.

And companies facing higher tariffs will likely pass the bill to consumers.

Similar developments are likely to ensue all over the world from retaliatory tariffs and so on.

Both consumer and producer prices will go much higher due to trade tariffs, which are very beneficial for inflation, and supports much higher gold and silver prices.

Historically, investors have used gold as an inflation hedge and the yellow metal has seen prices increase substantially when inflation rises above 3%.

Gold and Silver Trade Decoupled from Fundamentals

In the most recent bull cycle, gold and silver started going up substantially in the mid to late 2000s, and then exploded higher when the Fed took rates down to zero and started implementing QE.

This bull cycle is just getting started, it began in the end of 2015, and prices will go substantially higher as inflation spikes, and should explode higher when the Fed engages in further monetary manipulation to make America’s debt problems more ‘manageable’ and/or attempt to avert or lessen the impact of future economic downturns.

I believe the current situation is analogous to where gold and silver were in the early 2000s.

Prices were bouncing around in a sideways trajectory, much like they are right now.

Then, around 2004-2005, a wave of inflation began to propel prices higher, much like the increasing tide of inflation we’re seeing develop right now.

And then, through financial engineering, the Fed drastically increased the money and treasuries supply, and gold and silver skyrocketed.

A second wave of something similar is coming down the line, only this time gold and silver are likely to grow substantially higher than they did during the past bull market cycle.

The World Gold Council (WGC) holds a similar view.

It believes gold’s current price presents an attractive entry point, as investors should expect macro trends to boost the yellow metal’s relevance over the coming months.

The WGC makes the case that three critical macroeconomic forces will drive gold’s behaviour during the second half of 2018: positive but uneven global economic growth, trade wars, and rising inflation and an inverted yield curve.

Uncertain US Political Landscape

The US political scene remains divided like few times over recent generations.

The upcoming mid-term elections will either provide President Trump with validation or put a giant roadblock in front of his initiatives for the next two years.

While polls are leaning towards the opposition Democrats taking control of at least one house of Congress, we have learned that polls can be misleading.

The level of the US stock market and economic growth would clearly favour the ruling party in an ordinary election; however, few things are normal in the world of American politics these days.

At the same time, the investigation of Russian collusion in the 2016 and other issues continues to weigh on the Trump administration.

Moreover, calls for impeachment by Democrats and a vitriolic environment in Washington, continue to rise to unprecedented levels.

Uncertainty over the election could cause volatility in markets in the lead-up to the November contests and gold could be a beneficiary.

Conclusion

I remain very bullish on gold and silver short, intermediate, and long term.

Recent price gyrations appear to have nothing to do with long term fundamentals pertaining to gold and silver, but are likely the result of short-term trading, especially the positioning of the US dollar as the current safe-haven of choice.

Thus, the recent sell-off will in time will come to be seen as a substantial buying opportunity.

I anticipate gold will recover to trade between $1250 and $1350 over the next 12 months.

 

 

 

 

 

 

 

Disclaimer: Gavin Wendt, who is a director of Mine Life Pty Ltd ACN 140 028 799, compiled this document. It does not constitute investment advice. I wrote this article myself, it expresses
my own opinions and I am not receiving compensation for it. In preparing this article, no account was taken of the investment objectives, financial situation and particular needs of any
particular person. Investors need to consider, with or without the assistance of a securities adviser, whether the information is appropriate in light of the particular investment needs,
objectives and financial circumstances of the investor. Although the information contained in this publication has been obtained from sources considered and believed to be both reliable and accurate, no responsibility is accepted for any opinion expressed or for any error or omission in that information. I have no positions in the stock mentioned and no plans to initiate any positions within the next 72 hours.

 

Lithium Australia Boss Laments Lack of Government Foresight

COMMODITY CAPERS: Lithium Australia (ASX: LIT) managing director Adrian Griffin launched a stinging criticism of the lack of government support for the emerging Australian lithium industry.

Griffin has never been one to waste words when getting a point across and he took aim at a government he – and others – see to be missing a great opportunity for the country.

That opportunity being the development – in country – of technologies to produce lithium concentrates to export as the essential additive to the battery industry and make the country richer than it currently is.

Griffin intimated that there is currently plenty of interest in the battery technologies being developed by Lithium Australia from industry players internationally.

Unlike the company’s home country, he said many of these jurisdictions sitting beyond our sea-girt shores are encouraging Lithium Australia to consider opportunities within their own regions, where governments are prioritising the development of such technologies as a key focus of next-generation economic growth.

“Unfortunately, although Lithium Australia is at the forefront of next-gen battery technology and supply sources, it has not received the same encouragement from within Australia, where its governing bodies, while voicing enthusiastic support for mooted downstream lithium processing, are in reality allowing the country to lag behind international competitors – despite the natural advantages Australia enjoys with its rich endowment of lithium and other battery elements,” Griffin said.

“Australia’s federal government in particular has significantly reduced R&D rebates, now capped at $4 million per annum for all but the biotech industry, which will continue to enjoy open-ended rebates for the purposes of conducting clinical trials.

“Is this anomalous, in that pilot testing and product endorsement within the metallurgical industry in many ways mimic clinical trial processes for biotech products?

“Lithium Australia has, for example, initiated similar procedures to secure product endorsement of the advanced cathode powders being produced at its VSPC plant in Brisbane, Australia.

“As it stands then, the federal government’s R&D policy would provide biotech companies with an open-ended rebate for clinical trials of lithium carbonate (an accepted treatment for certain medical conditions but also a precursor to the manufacture of lithium-ion battery cathodes) but not Lithium Australia for trials of the same product for other applications.”

 

Email: info@lithium-au.com

Web: www.lithium-au.com

 

WA Industry Health Important to Nation’s Wealth

COMMODITY CAPERS: As Diggers & Dealers is a Western Australia-based event there is little wonder it focuses on that state’s industry and how it is ticking along.

The recent GST turnaround by the Federal Government was a long-awaited ‘dip of the lid’ to the WA mining sector, which has been a strong contributor to the state’s – and nation’s – high standard of living.

With its coffers now fuller than they were, hopefully the WA government can start to shift its gaze from the low hanging fruit of industry-focused royalties and look to contribute to greater infrastructure.

By doing so it may very well allow the industry to continue this contribution by taking a lead in the beneficiation of commodities vital to the surging global electronics industry.

“Investment in Australia’s mining industry eased in the March quarter 2018 and is expected to be little changed through the remainder of the year.”

Unfortunately, The Roadhouse cannot claim such a knowledgeable sobering statement, in fact it was expressed by the Office of the Chief Economist (OCE) in its recent June 2018 Resources and Energy Quarterly.

The bean counters went on to declare that,” mining investment is expected to have declined by around five to ten per cent in 2017–18, to around $35 billion.”

A figure it put down to the years of sharp declines from 2012–13 when investment reached $95 billion until the good times ended abruptly, putting an end to the much lauded ‘mining boom’.

These figures, the OCE said, followed its expectations, adding that its crystal ball was telling it that we can look forward to a small downturn in mining investment in the short-term leading to capex in the sector levelling out thanks to an anticipated jump in projects both under way and consideration, to construct a sturdy base for future mining investment beyond 2017–18.

GOLD

The OCE predicted the value of Australia’s gold exports could reach a peak of $20 billion in 2019–20, propelled by increased production and export volumes (356 tonnes), however it did suggest a rising US dollar will limit the upside for the price of gold.

This follows a healthy year (FY 2016-2017) for the yellow metal, during which Western Australia’s gold sales broke through the 200-tonne barrier to reach 205 tonnes (6.6 million ounces), the highest level since 1999–2000.

A four per cent increase in year-on-year sales across the industry combined with strength in the Australian dollar gold price for a seven per cent increase in the value of the gold sector from $10.1 billion in 2015–16 to $10.8 billion in 2016–17.

The second half of 2018 and the subsequent two years, according to the OCE, will be gold’s time to shine as political uncertainty drives investment in bars and bullion-backed investment funds.

“Trade tensions between the US and China are expected to continue through to 2019, and possibly 2020,” the OCE said.

“Geopolitical tensions in the Middle East — linked to the Gaza conflict, Syria’s civil war and the possible failure of the Joint Comprehensive Plan of Action (JCPA) relating to Iran’s nuclear materials program — are yet another source of upside for gold.

“Any sustained overheating in the US economy would likely see inflation rise and gold demand rise, as investors seek an inflation hedge.

“Rising inflation would likely also push US Treasury bond prices down.

“Gold is likely to benefit in the short run, with the price likely to increase by around eight per cent in 2018, to average US$1,352 an ounce.”

LEAD

Not all roads – or mines for that matter – are paved with gold, and other metals are currently enjoying the renewed interest being shown to the sector.

Although lacking the same renown as it shinier cousin, lead is gaining some notoriety thanks to the growing interest in electronica.

The largest current use for lead is in batteries for vehicles.

This application accounts for around 80 per cent of modern lead usage with lead-boffins predicting this figure to rise with an increased role for lead in large storage batteries used for load-levelling of electrical power and in electric vehicles.

The growing popularity of electric bikes, particularly in China, has led to an increase in demand for lead to make batteries for e-bikes.

NICKEL

The Western Australia Department of Mines, Industry Regulation and Safety (DMIRS), in its Statistics Digest for 2016-2017, acknowledged nickel as one of the more volatile commodities over the period.

“Prices were comparatively positive at the start of the financial year following strong stainless steel production in China and demand growth for nickel in batteries for electric vehicles, which pushed the monthly average to an 18-month high of US$11,142 per tonne in November 2016,” the Department said.

“However, the nickel sector was again affected by global events.”

These events were the January 2017 relaxation by the Indonesian government on its nickel ore ban, indicating a possible increase in exports, causing global nickel prices to drop more than nine per cent between December 2016 and January 2017 from US$11,013 per tonne to US$9984 per tonne.

The Filipino government flipped its hard-line stance, announcing it was unlikely to enforce the closure of nickel mines in response to environmental concerns.

The OCE expects the nickel price to rise above US$13,400 a tonne in 2018.

“Nickel prices faced significant upward pressure in the June quarter, rising from just over US$13,000 a tonne at the start of April to US$13,600 a tonne by the end, and then to over US$15,450 a tonne in early June,” the OCE said.

“Prices have been supported by the emergence of a significant supply deficit driven by higher stainless steel production.”

A rise in nickel supply is expected to continue with mine output projected to rise from 2.3 million tonnes in 2018 to 2.5 million tonnes in 2019 and 2.6 million tonnes in 2020.

Around $46 million was spent on exploration for nickel and cobalt, its long-overlooked companion and now market sweetheart, during the March 2018 quarter.

When lined up against the $48.6 million spent in the December quarter, it doesn’t look as though much is happening, however it is more than double the spending at the same time of the previous year.

Price growth will always lead to interest and nickel, like cobalt, is no orphan in this regard.

The bulk of growth in exploration spending across Australia is occurring among the large untapped deposits of Western Australia.

“Australia’s nickel production is expected to rapidly recover from a period of significant mine and facility closures in 2016 and 2017,” the OCE said.

“Mine production is expected to rise from an estimated 163,000 tonnes in 2017–18 to 168,000 tonnes in 2018–19 and 178,000 tonnes in 2019–20.”

COBALT

Nickel miners producing cobalt as a by-product are taking advantage of strong prices with the cobalt price hitting a high of US$70,000 per tonne in July.

Although Australia has significant cobalt reserves, there are no dedicated cobalt mines in operation, however, since the demand created by the electronics industry has heightened interest, there are several companies looking to change this.

Currently most cobalt is mined as a by-product of copper, gold or nickel, and about 40 of Australia’s gold and nickel operations are co-located with some form of cobalt deposit producing varying quantities of cobalt as a secondary commodity.

“Most deposits are in Western Australia, though there are small producers in Queensland, New South Wales and South Australia,” DMIRS said.

“Australia accounted for four per cent of global cobalt production in 2011.

“In the March quarter 2017, nickel and cobalt exploration expenditure increased by 187 per cent year-on-year to $20 million – the highest quarterly expenditure on nickel and cobalt exploration in more than two years.”

MINERAL SANDS

The Western Australia mineral sands industry is concentrated on titanium minerals such as ilmenite, which can be sold directly or upgraded to synthetic rutile.

These minerals represented more than half of the industry’s value for 2016–17 with the remainder from zircon, garnet and staurolite.

Western Australian mineral sands exports exceeded reported production in 2016–17, with $794 million in exports.

Mineral sands differ to many of the commodities produced in Western Australia, in that they are exported to a wider range of countries.

Around 35 countries benefited from WA’s minerals sands abundance throughout 2016–17 with, surprise, surprise, China running out as the state’s largest export market, taking just on 25 per cent of exports.

Other major destinations included the United Kingdom (12 per cent), Saudi Arabia (11 per cent) and the United States (11 per cent).

LITHIUM

“Emergence of the battery market Global battery markets entered a period of extremely rapid growth in recent years, and the implications for Western Australia are potentially significant,” DIRS said.

“This is partly due to the potential of battery technology itself, and its capability to revolutionise clean energy, vehicles, and consumer products.”

The WA lithium sector exercised its vocal chords earlier this year with backing from the Association of Mining and Exploration Companies (AMEC).

The lobby group produced a report encouraging State and Federal government participation in development of the Western Australia lithium industry.

AMEC hopes its proactive stance on the issue will inspire State and Federal governments of all persuasions to do the same, rather than be reactive, while the global demand for lithium as a vital element of the global electric vehicle revolution is in a relatively embryonic stage.

In its Future Smart Strategies Report, AMEC declared WA could become a leader in the downstream processing of battery minerals, which it believes could be worth $2 trillion by 2025.

It’s a fair point, considering WA already mines 60 per cent of the world’s lithium and produces all the other minerals necessary to construct batteries, which stands out as a genuine industry opportunity for Australia, and for Western Australia.

In its follow up report, The Path Forward: Supporting the development of a lithium and battery mineral industry in Australia; AMEC outlined the next steps it believes the State and Federal Government should be taking to make the most of this battery mineral processing and manufacturing potential.

“There is a two-year window for industry and both tiers of Government to act, this plan steps through what needs to be done to get further down the value chain,” AMEC chief executive officer Warren Pearce said.

“There is a clear need for both tiers of Government to provide leadership in the development of a domestic battery industry.

“A clear signal from Government has to be sent to attract investment to Australia.

“There must be a willingness to clearly plan and coordinate where a battery industry would be located, and deliberate efforts made to entice international companies to come and set up in Australia.”

Of course, this is just the tip of the commodity iceberg that is Western Australia.

Throw in other traditional commodities the state produces such as iron ore, zinc, and copper and the tale of wealth and potential offered to economic growth within and without the rabbit-proof fence seems endless.

 

Resources IPOs Lead 2018 Listings

COMMODITY CAPERS: An interesting piece of research hit The Roadhouse inbox this week in the shape of a Snapshot of Australian IPO Activity for the first half of 2018 from our friends at HLB Mann Judd.

According to the business and finance advisers’ Perth-based Partner Corporate & Audit Services man, Marcus Ohm, the first six months of 2018 witnessed a slower start to the IPO market than the same period for 2017.

Through the 2018 time-frame 39 companies listed on the ASX, compared to 57 for 2017.

As always, there was some silver lining the declining IPO cloud with 2018 still managing to outperform the previous five-year average of 37 listings.

“During 2017 there were 110 listings in total and these were relatively well spread throughout the year, which is contrary to the trends seen over the past decade,” Ohm noted.

“Historically, approximately a third of new listings occur in the first half of the year, which would indicate that 2018 may still prove to be a positive year for the Australian IPO market.”

The irony continued with the month of January providing the strongest month to date – listing-wise – with 10, but money-wise it recorded the lowest total funds raised, with just $50 million, or two per cent of the total for the six-month period.

April came in as the strongest money month, thanks to the listing of L1 Long Short Fund Limited (ASX: LSF) to the tune of $1.3 billion, accounting for 65 per cent of all funds raised for the six-month period.

May was also a good month, welcoming seven new listings – the same number as April.

RESOURCES MAINTAIN THE RAGE

The resources sector continued to be a major contributor to the IPO market, making way for 16 listings in the first six months of 2018.

According to Ohm, the sector is performing on par with its start to 2017, when 15 new listings hit the bourse.

Most noteworthy is that it is the rock-kickers doing all the heavy lifting in the sector with Energy stocks failing to bother statisticians.

Source: HLB Mann Judd

“New Materials listings are still enjoying support from the market, with an average of 98 per cent of subscription rates achieved, which is similar to 2017’s subscription rates,” Ohm observed.

In the lead-up to Diggers & Dealers it is good for the Western Australian sector to be well-represented.

The state has continued its domination of the resources listings, providing 13 new listings.

New South Wales, Queensland and Victoria all recorded one listing each.

“While the Eastern states are usually home to the larger resources listings, this has not been the case so far this year with only $28.1 million raised,” Ohm said.

“Three states: Western Australia (+12 per cent) NSW (+11 per cent) and Queensland (+10 per cent) all recorded gains to the end of June, with only Victoria finishing in the red.”

With IPOs heavily slanted towards WA, it can be no surprise gold has featured heavily in the listings for the start of the year.

Five listing to date in 2018 are solely focused on the precious metal while another five polymetallic companies are also on the lookout for gold.

Copper and nickel have also enjoyed their recent rise in popularity and relevance thanks to the interest generated by the burgeoning electronics and Electric Vehicle spread across six and five listings respectively.

“No other commodities recorded more than two listings, however the diversity of the market continues to grow with over 14 different resources sought,” Ohm said.

“Coal, which for some time has struggled to gain traction in the market, recorded one listing.”

So, there we are at the halfway mark and with another 11 listings in the pipeline for 2018, coupled with an outlook of strong commodity prices and solid share price performance, Ohm predicts Materials IPOs are likely to remain strong performers for the remainder of the year.

 

Web: www.hlbwa.com.au