General Discussion, page-1762

I’m cautious about expecting a faster recovery. I think what we’ll see over the next 3-4 years at minimum is the gradual increase in lithium price to LCE US$16000-25000 range. A US$20000 price allows up to $US1500 spodumene price and $US4000-6000 in conversion costs. This lets lots of operations be profitable.

I was reading a China mining report and expected capacity from lepidolite could still increase by 2025-2026, I think it was potentially up to double their 2023-2024 production levels. Zimbabwean mines have a suggested capacity of minimum yearly capacity of 1.1 mtpa spodumene. We don’t know how much of that capacity is real, and where they’re sitting at in production numbers. The figures aren’t available.

What we’ve seen is that the West takes longer for mine development than expected, however, this is offset by Chinese backed operations, which have demonstrated that they can get into production quicker than anyone can imagine.

I think GCar previously mentioned yearly LCE needs is expected to grow by 200-300 kpta. This is good news, however, there are many spodumene mines and expansion projects that will likely be profitable at $US1500 per tonne: Kathleen Valley, Mount Holland, Groto do Cirilo, Nemaska, James Bay, P1000, Wodgina, Goulamina, Greenbushes.

Then there’s the known brine expansions: There’s Chinese investment in Argentinian and Bolivian brines, SQM expansions, SDV, LAAC, Rincon.

This supply will take time to work through the system. In short, I’m not expecting dramatic price rises ever again. A slow gradual one is good enough for me.

The key point to realise though, is the that lithium price recovery isn’t at all critical for ALTM. They are profitable at these and significantly lower prices and share price appreciation can happen simply by meeting their expansion goals. The other benefit is that their brine resources have multiple decades of useful life, so depletion at low prices isn’t really an issue.

This post has been made for my own research purposes.