...Spod prices are crashing ! Down -30% from the $850 level that was once thought to be the springboard to higher prices.
...Why are Spod prices falling so badly when global EV sales are still growing (albeit slower)?
...Clearly that tells you that it is false notion that EV growth must lead to higher Spod prices and clearly it has been lower Spod prices, amongst other factors, that enabled EV growth.
...at this rate, lithium producers have 3 options
a) put their mines under C&M i.e ceasing production = no revenues OR
b) continue producing them at a loss just to generate cashflows but with dwindling cash balances OR
c) sometime soon, start raising more funds via a discounted CR while there remains appetite.
a) is probably difficult because it would cause a sharp fall in share price and disrupt any existing supply contracts
The longer these producers continue on (b), it leaves them with little wiggle room and risk going into administration if they can't raise funds further down the road.
c) is the option they rather delay but it is coming soon.
