Nick Snyder and Pete Thomas - VP of Zaner Precious Metals

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Nick Snyder:
All right. Welcome everybody. We're here for another CATs Corner. How you doing today, Mr. Pete Thomas?

Pete Thomas:
I'm good. I'm good. I'm recovering from my trip back from London. And it was a typical London trip, rained every day and the food was awful. So, no surprises.

Nick Snyder:
There you go. I've never been over that way, but what were you doing in London?

Pete Thomas:
I was speaking to the Middleton Mining Conference, that was at about 400 guests. It was very good. And not to bum-rush the English, they've always been very... I've always had a good time there. So it was a good show. A lot of people turned up, more on the exploration side, more as to what's going on in the industry as far as yields and new exploration and new mining techniques. And I was fortunate enough to be asked to be one of the keynote speakers on the new usages of metals. And I think it went pretty well and I learned quite a bit.

Nick Snyder:
Nice. So I assume you guys touched on platinum and palladium and rhodium and all that.

Pete Thomas:
Well, we... I sat down and talked with some minors that are in the process of exploring new areas and seeing what their yields were looking like. And I was really... Nick, for your viewers, I was trying to get a better view as to downstream, when a lot of this new mining is going to be coming online-

Nick Snyder:
Mm-hmm (affirmative).

Pete Thomas:
And a lot of it's pretty far away. I mean, the vast majority was right around three years.

Nick Snyder:
Yeah. I can't imagine that process is quick. And that's where it becomes so much quicker to recycle, like you say, the above the ground materials.

Pete Thomas:
Right. Right.

Nick Snyder:
So much easier to get those back into the supply stream, get a [inaudible 00:02:02] out to the manufacturers, if us recyclers can gather all the units and get it to the platinum smelters, platinum refineries. We can, help the cause at least and just kind of see where the pricing will go. So-

Pete Thomas:
Well it's more than helping the cause. I mean, right now, I believe go globally, you're shouldering about 33% of the weight and no one acknowledges, it's so strange. We have such a positive thing going on here in recycling in that we're not carving into the earth, we're using existing materials. We're creating cleaner air with that. And it's... People turn their nose up at recyclers and I... What we're doing for the planet is incredible.

Nick Snyder:
Yeah. I agree. A hundred percent.

Pete Thomas:
Yeah.

Nick Snyder:
So talk to me. Pricing has been bad.

Pete Thomas:
[inaudible 00:03:01] Well, I told you this was coming, right. I mean, we had a talk about this a while ago. All you guys that follow you here in CATs corner know that hey, I felt that the market was soft. We were going to see a pull back probably into the first quarter. The new COVID strain, which I actually sat in a conference with some scientists in England, they're doing research on it. And it isn't going to paralyze the market as much as a lot of people thought. And we're seeing very, very big numbers as far as investment goes. I mean, right now, Nornickel released today, this morning, they're talking about putting another 6 billion dollars over the coming decade into the expanse of their mining of platinum and palladium. So-

Nick Snyder:
Wow.

Pete Thomas:
Existing producers believe in themselves that are putting more money in what they're doing. And I think that's a real positive note.

Nick Snyder:
So that shows for the long term-

Pete Thomas:
Yeah.

Nick Snyder:
Maybe after the first quarter of 22.

Pete Thomas:
Right.

Nick Snyder:
Maybe we see a bounce back, is that what you're anticipating?

Pete Thomas:
That's what I'm thinking and I'll tell you something else. This we're seeing, for example Texas picked up the flag and is rallying everyone, as far as chips go. We have suffered as far as platinum palladium prices, just due to the fact, no chips we're not making new trucks, we're not making new cars. And that is certainly... Trucks, heavy trucks and buses for that matter are all using PGMs. And we're not seeing it right now because we're not getting enough chips to produce. And we're seeing now bigger numbers, larger output. And I think next quarter, we'll start to see the auto manufacturers pick up and we'll start to see demand of at the base level for platinum palladium.

Nick Snyder:
Why do you think it keeps going down? Do you think things get under 900 for platinum?

Pete Thomas:
We could see 850.

Nick Snyder:
You think 850?

Pete Thomas:
Yeah. I hate to say it, I mean today we were under a lot of pressure. I mean, platinum was 15 lower. Took out 950, which was my number earlier. Is there another 100 bucks in here? Yeah, unfortunately there is. Palladium, I gave you the numbers back up there around 1880, 1860 and then 1800. Now we're below 1800, we're going to have to see if it holds 1883, or 1783. Platinum is down, exchange wise, down 3% today.

Pete Thomas:
So they're still whacking it and they're whacking it hard. And really conductive metals are under pressure. And remember, I gave you guys a heads up as from the copper side. Evergrande I missed its bond purchase and they're building a thousand. Wait, was it like a thousand a year? Yeah, they're talking about a million condominiums they're going to build, all of which use conductive metals. So there's a lot of pressure across the board. Also, something that's real important for your guys too, and you all know this, is that in construction equipment, we use platinum palladium as well and platinum... Right now we're looking at anywhere from 35 to 39% reduction in purchase of equipment. So we're getting hit from all sides right now.

Nick Snyder:
Right. Well, well, I mean, I guess we'll just have to wait and see what happens and we'll keep doing these to inform everyone and-

Pete Thomas:
Yeah.

Nick Snyder:
We can jump on another one, maybe one more for them.

Pete Thomas:
Yep. Maybe one more before the year is over, I'm here. I got a quick trip to Cairo and then I got another one, I think, out of the country as well, and see if that firms up, but I'll be here to at least get one more in for you. I think that people don't realize the hard work that goes into mining this product. And we saw 69 dead this year in mining, in South Africa, so... Last year was 43, 44. So the numbers are going up, we're going deeper in the same mines. The danger goes up and our hearts go out to the families that lost their loved ones that were mining. And I think that we're going to see continued pressure on existing mines because, they're just having to go through more difficulty to get product out.

Nick Snyder:
Well, that makes sense.

Pete Thomas:
Yep.

Nick Snyder:
I mean, that's a shame that people have to die to get this material out.

Pete Thomas:
People need to understand that people pay a price, and a very deep one, in order to make their lives better. So, appreciate your scrappers, appreciate what's being done to clean your air because people are paying the ultimate price here.

Nick Snyder:
Yes, sir. All right. Thank you, Pete. Have a great rest of your day and-

Pete Thomas:
Thank you, sir.

Nick Snyder:
We'll see you next week.

Pete Thomas:
Got a deal.

Nick Snyder:
Thanks, bye.