The share price for Sheffield Resources Ltd [ASX:SFX] has gained 10.7% today. Sheffield has snagged a big buyer for its zircon.
What’s the deal with Sheffield Resources Share Price?
Sheffield owns and operates WA mine project Thunderbird, a site that is rich in zircon. Today, Sheffield announced that it had signed a deal with Indian company Sukaso Ceracolors. The nation’s largest raw ceramic supplier.
The agreement will see Sheffield supply 12,000 tonnes of zircon to the Indian company annually. The deal will last for five years, but could be extended thereafter.
Sheffield will certainly be looking to build a strong relationship. Especially as their mine has an expected life of 42 years.
What next for Sheffield Resources?
Today’s deal is a big deal, but they still need more customers. The deal means they’ve got buyers for 36% of their total zircon output. A great start, but hopefully they can snag a few more buyers soon.
Sheffield’s Managing Direction Bruce McFadzean commented:
‘With more than one third of our premium zircon for Stage 1 of Thunderbird now under binding agreement, over the coming months we will continue to deliver on our offtake and funding objectives which we commenced in 2017.’
Construction of the site is expected to start later this year.
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Junior Analyst, Money Morning