Oil, gold, and copper have shed roughly 10% of their unit values this month. Most experts have adopted a very bearish outlook to the point of jumping on the doom and gloom bandwagon. Not I, sayeth The Mercenary Geologist.
Mineral commodities trade in four to seven year boom and bust cycles within longer 20- to 30-year secular market trends. Since starting work I have experienced the end of a 30-year secular bull market, a 23-year bear and a seven-years on-going bull.
In 1970, the plant started production of rare earth and specialty metals products and uranium processing ceased in 1990 concurrent with the fall of the USSR. In 1997, the formerly state-owned plant was privatized.
Thorium as nuclear fuel is clean and safe and offers significant advantages over uranium. The technology for several types of thorium reactors is proven but still must be developed on a commercial scale.
My recent trip to Europe included four days in Portugal. The purpose was to examine Avrupa Minerals' Portuguese projects including its tungsten-gold project in the north and Pyrite Belt projects in the south.
I've been waiting for indication of a long-term upside movement in the natural gas market for over three years. But in this case, it has never looked prospective enough for me to venture in. And frankly, that perplexes me.
For the diligent speculator, it makes sense to eliminate the many rare earth element pretenders from the few contenders as quickly and efficiently as possible. We can accomplish this task by employing simple economic parameters.
Taking all the various factors into account, I am bullish on the copper price in the near term. A general range of $3.50-$4.00 per pound in 2012 will provide high margins for producers and stimulate mine production.
The past four months has been a remarkable and unprecedented time for my favorite rare earth element companies. Yes, folks, this is a speculative bubble that will burst at some point in the future. But I think it's still early.