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Is lithium hydroxide wanted globally ? BMW sign two deals in 24 hours lol. I think its game on.
"This new agreement marks a significant milestone for the company, as the JV aims to convert lithium concentrate into lithium hydroxide, meeting the specifications of a long-term supply agreement with BMW."
Wood McKenzie lithium carbonate & lithium hydroxide current review.
"1. Strong growth is creating a ‘bumpy’ lithium market
Lithium strongly demonstrates the characteristics of an immature market, with the supply balance fluctuating between deficit and surplus. A single end use is rapidly coming to dominate the market, with rechargeable batteries now accounting for approximately 85% of global demand. As EV uptake took off through 2021 and 2022, demand surged.
However, infrastructure development in terms of both mines and refineries requires massive investment of both time and money. As a result, supply struggled to keep up.
This imbalance caused prices to soar in 2022, peaking above US$70,000 per tonne. However, demand growth has been slowing down somewhat as EV subsidies are reduced or removed and prices have fallen back in 2023. Going forward, we expect prices to enter a period of controlled decline, settling back to around US$20,000 per tonne by the end of the decade."
https://www.woodmac.com/news/opinion/shaping-lithium-market/
Cont...Wood McKenzie lithium review
"2. Quality is an issue as batteries become the dominant market for lithium
While more and more lithium is being deployed to make rechargeable batteries, not all lithium is useable for this purpose. Battery-grade lithium products have to be of the highest quality and purity and are therefore the most complex to produce. New refineries will tend to start by producing lower quality, technical-grade lithium, which is not directly useable in batteries.
As new plant operators gain experience and fine-tune their operations, the purity of the refined product can be improved to the point where it becomes viable for batteries. Only at this point can the qualification process begin, which is something that each cathode maker does individually.
As a result, despite a high overall supply surplus battery-grade lithium products will see a tighter market, at least in the short term."
Cont...Wood McKenzie lithium review.
"3. Lithium is not really a single product
Another complicating factor in assessing future lithium supply and demand is that the market actually comprises two different key products. Both lithium carbonate and lithium hydroxide are used in the production of rechargeable batteries for EVs and electronics. However, the use of one or the other is decided by the cathode chemistry used in the batteries.
Lithium carbonate is mainly driven by lithium iron-phosphate (LFP), which has been widely used in batteries in the Chinese market and is now making inroads in other regions. Lithium hydroxide is driven by high nickel cathode chemistries, which are increasingly favoured by the premium EV market due to their higher energy density. This has important implications for the pricing of the two different compounds.
4. Sources of lithium supply in the long term are unclear
Our knowledge of existing, planned and potential projects means we can project the trajectory of lithium supply until the end of the decade with reasonable accuracy. Mapping this against expected demand makes it possible to forecast price trajectories over the medium term with reasonable confidence.
From 2030 visibility becomes much less clear. At this point incentive pricing – the price at which it becomes attractive for companies and investors to commit to new projects – becomes an important factor. Assuming 1.5 million tonnes of supply, the fully allocated cost of lithium (C3), including operating costs, indirect costs and interest charges, would be around US$15,000 per tonne. Market pricing would therefore be somewhere north of this."
Cont...Woods McKenzie lithium review
"5. The lithium market is still relatively immature
Perhaps the biggest challenge in forecasting the future of the lithium market is that the industry is still essentially in its infancy. There are no globally accepted specifications for the product, and therefore no accepted anchors to ground pricing.
The need for unique and very precise specifications makes lithium products almost comparable to speciality chemicals in terms of pricing complexity. At the same time, the need to keep up with continued demand growth prevents the industry from taking a step back and assessing how to establish a more uniform and consistent approach. Greater standardisation is likely in the future, but it will take time to emerge."
Final part of the Woods McKenzie lithium review and conclusion. Is there a need for global lithium hydroxide ... Yes. Interesting Pilbara pops up , teehee
"6. Partnerships will be key to the lithium industry’s future
In 2022, 52% of lithium supply came from just five companies. However, we do not anticipate significant M&A activity in the industry and predict these companies’ share will decline to 36% by 2032 as smaller firms grow and new ventures emerge. But while horizontal integration will not be a big theme going forward, vertical integration certainly will be.
Partnerships between miners and refiners make sense, since they can share both the risk and the huge capital requirement involved in new projects. Working together, upstream and downstream operations can leverage each other’s expertise to improve margins and capture more market share. This sort of alliance is already happening; for example, Pilbara Minerals have partnered with POSCO in South Korea, while SQM and Wesfarmers have joined forces on a project in Western Australia. We expect similar partnerships to become prevalent in the industry in future."
MO 7.15am post. Do you know who provided the finance for Frontier? If not, I will find out and post.
MO 7.26 V interesting..... Do you have a link?
FT take on BMW deal with Saudi..
Saudi Arabia is planning a second lithium processing facility, as it steps up efforts to work with western partners to develop its battery supply chain.
The facility, which will use feedstock mined in Austria to produce refined lithium hydroxide for BMW, is a sign of how supply chains to process the metal are slowly developing outside China.
China accounts for nearly 60 per cent of global processing for lithium, a critical ingredient in electric car batteries — and the EU and US are bolstering incentives to create more capacity.
Australia-listed lithium start-up European Lithium and the Saudi industrial conglomerate Obeikan Investment Group will each take a 50 per cent stake in the plant. The facility will cost $350mn-$400mn and will probably produce its first lithium hydroxide in 2026.
European Lithium will supply the processing plant with lithium ore, known as spodumene, from its mine in southern Austria.
“A lot of the world is fearful about what would happen if China switched off its [lithium] exports,” said Tony Sage, executive chair of European Lithium. “It would be a disaster for the energy transition.”
For Saudi Arabia, the project is the latest in a series of deals aimed at boosting its role in electric vehicle production and the battery supply chain — part of broader efforts to diversify beyond oil revenues.
Earlier this year Saudi Arabia signed an agreement with EV Metals, an Australian battery manufacturer, to develop a lithium hydroxide plant that will be in production in 2026.
Lithium processing is highly energy intensive and Sage said Saudi Arabia was an attractive location for a processing facility because of its cheap energy.
Saudi Arabia aims to produce 500,000 vehicles a year by 2030, including those produced in the country by US-based Lucid Motors, in which its sovereign fund the Public Investment Fund acquired a majority stake.
Lucid, which has struggled over the past few years, said on Wednesday it would raise $3bn in a stock offering, with 60 per cent of the funds coming from the PIF.
The wealth fund, which is chaired by Crown Prince Mohammed bin Salman, has also started its own electric-vehicle manufacturer, Ceer, which is planning to produce 170,000 vehicles a year, in conjunction with Foxconn and BMW.
European Lithium said its total capex needs for building its Austrian mine and nearby ore concentrator, as well as developing the Saudi plant, would be between $800mn and $900mn. It is planning a secondary listing on Nasdaq via a special purpose acquisition company, or blank cheque merger, in the coming months.
I don't like excessive pumps. But I haven't seen any videos of Alk's investor presentation or RNS this year. What are they using the money for?
Advertising and Marketing £147,199
little twitter and internet news???
Flights to Australia, S Africa, S America, US and EU all with varying amounts of days.
Meeting with the Australian PM & Minister for Energy, the Management team of Port Hedland , Rio Tinto, BP etc etc
Meetings / investor presentations and meeting with lithium supply clients, plant supply via SembaCorp , site visits for clients, visits to financiers all on the book ?
Marketing & advertising is a cost and it may not be in this country.
How did TVL/ALK get the Port Hedland Australia lithium processing engineers ? Lucky dip in a Walkers crisp box ?
I would like to see some form of presentation across the media though, I think it would help in general for 2023 as a guide but things have obviously slipped in timescale. So has Pilbara Minerals doubling of production in Oz strangely enough ....
Hi MO, hope all is going well.
I wonder if we are waiting for the same thing as Rishi - i.e. the meeting with the Tata chairman Natarajan Chandrasekaran. All gone a bit quiet since 24/5/23.
Source: https://news.sky.com/story/tata-jaguar-land-rover-owner-set-to-build-new-gigafactory-in-uk-12888473
I wonder which refinery Tata will buy lithium hydroxide from. :)
I hope all the lithium refineries in the UK do well.
Lelelele
Which refiner to buy from? That may depend on the terms of the grant of £100's millions from HMG. HMG wants a resiliant UK based, mine to car industry. My guess is that will favour UK refiners.
Https://twitter.com/alkemycapital/status/1681963769612623873?s=46
Coverage of Tata’s £4bn gigafactory investment in UK by @Channel4News
Europe has a major shortage of #Lithium production capacity
#ALK’s #Lithium hydroxide processing facility will represent c15% of Europe's demand by 2030 & will be located in a world-class chemicals park
Thats quoted spread, but you could buy at 1.89 and sell at 1.77 for most this afternoon, it’s often around 10/12p real spread
30p gap is usual.
20p gap is when there is interest.
10p hardly seen and when its normally on speed.
30p is normal with buying and selling usually within 10-12p from after first 30 and last 30 minutes.
The MAGIC 10P spread 👍
Buying is usually strong on a 10p spread , my total guess / THEORIST view is £1.90-2.00 close 🤞🤞🤞
The Theologist's boss's are the ones selling ALK & PRE down, their Messiah is well known for it. He also has a personal gripe with our Chairman going way back to the Normandy / Leyshon restructure.
Corporate bonds of battery industry companies in other countries are very popular. :)
I hope Alk can get the funds well too.
Hummm..
"The Feasibility Study has been produced ahead of schedule in response to the due diligence requirements of certain global OEMs looking to utilise and contract with Alkemy's refineries."
Will alk announce a new mou this year? :o
They’ll be announcing binding feedstock this year, not just an MOU
For me this is not a get rich quick share - It’s a get rich share ! Lots of ups and downs but they pull this off it will be life changing from current SO in fe years time
It will come together. these quotes are nicked from the Tg from more informed person than me.. who works closely with co.
“The Feasibility Study has been produced ahead of schedule in response to the due diligence requirements of certain global OEMs looking to utilise and contract with Alkemy’s refineries”
“The above is the key line, the FS was and has been fast-tracked by OEMS, global ones who want to get their hands on ALK's LSM plans. The reaction to this is ridiculous, undoubtably some short term traders but in terms of progress this is a key announcement which they have also stated that they will follow up on at the end of the RNS”