Sales and Promotion
The dominant marketing factor of our product is the extreme high demand for our metals. We have clients ready in China, Germany, South Africa, Thailand, Singapore and Malaysia (mostly smelters and refineries) who are willing to buy everything we produce.
Market Analysis Summary
China is the biggest consumer of tin in the world. As long as this economy keeps on growing the demand will continue to increase. India is also catching up fast and increases their use of tin as more construction projects are executed and more industries are developing. Tantalite is used mainly in USA, Germany and China. The world economic growth also fuels more demand which makes it difficult to meet current supply level of tin.
In such growth, experts predict the resources boom will continue for many years to come and metals prices will continue to increase. The tin price is expected to increase from today's $18,000-20,000 /mt to the $20,000-24,000/mt level over the next 2-3 years and Tantalite and Niobium could break the $200,000/mt level.
Strategy and Implementation
The company's strategy is to focus on the EU and Chinese/Asian market with tin concentrate and ingots. A trial shipment of concentrate has already been sent to Malaysia Smelting Corporation in Penang - the world largest tin smelter.
Our marketing strategy consists of direct sales ex works and export to the end users in China and other markets. We have the logistic arrangement in place with RB Freight Management of South Africa http://www.rbfm.co.za and insurance policy with AIG (American Insurance Group) www.aig.com . We have an offer from QBE the largest credit insurer in Australia to get a credit policy when required. We plan to execute an “Off Take Agreement” in 2008.
The pricing policy is set based on the market price as advertised on www.lme.com for London Metals Exchange and on http://www.kltm.com.my for Kuala Lumpur Tin Market; in most cases it will be say 100% of LME daily cash price less say $500/ton (treatment & impurity charge) for tin concentrate of say 60% Sn (Tin) content (for example if today the price is $19,250/ton we get $18,750/ton for the tin in concentrate we supply). We have already negotiated with several buyers who are keen to secure the supply and sign a long term Off Take Agreement.
LME Tim Price in $US per tonne for the last 2 years
Investors are advised to consult with their advisors prior to investing in our company due to the risks associated with the mining sector in Zambia.
These risks include exploration success, operating risks, risks associated with resource estimates, commodity price volatility and exchange rate risk, environmental risks, insurance risks, competition risk, future capital needs, personnel and the speculative nature of the investment.
While Zambia is considered one of the most stable countries in Africa. The Zambian government is very keen to attract foreign investment and provide incentives to foreign investors. Investment in Zambia may carry a higher risk than investing in Australia in terms of the level of protection of the law, the legal system, economic and regional stability, transport and the risk of theft.
Libra is trying to protect its assets through the right contacts and developing good relationships with the government at all levels and participation in local community projects (e.g. assist local schools, repair local water bores and pumps, and other social projects of benefit to the local community).