Core lithium - ABC news, page-15

Is that the same benchmark that is predicting >25 projects with a cash cost over $11.6k/t will also be part of the supply picture in 2030?

If prices remain where they are now, very little if any of the right hand side of the graph below will be operational. If you take Benchmark's forecast and put a line through all the proposed project that are above 11,602/t then you are going to take something like 700kt LCE out of the supply side. That will mean many of the balanced years between 2025 and 2030 flip to being a deficit, and perhaps even a severe deficit.

If prices stay low for an extended period, Core will take longer to restart, but when they restart they are probably going to be fairly quickly receiving $3k to $5k/t+ spod prices and could be making A$500+m/yr because prices will need to reach demand rationing levels - prices that are high enough to mean a production ready battery gigafactory chooses to stay shut because of the price of its lithium input is too high to be profitable.

The cleanest pathway to meeting 2030 supply needs is for the price of LCE to fairly quickly increase by at least 50% if not be something nearer double. This would create the conditions whereby a steady stream of new lithium supply projects could start and create the supply shown in the graph below. If prices do increase ~50%+ then Core will most likely press the restart button and start making good profits within a couple of months. Not necessarily A$500m+/yr that comes from supply rationing prices, but still good profits. A large number of new close to FID ready projects would get to start development across 2024 to 2028 and create supply by 2030 and through this create the supply increases benchmark minerals predict below.

The graph below indicates a price near US$25k/t for LCE is going to be needed if most of that right hand blue area is going to come into production, be profitable and remain in production.