The big boy analysts seem to be getting a bit more positive on...

The big boy analysts seem to be getting a bit more positive on lithium, but I think they still think it'll crash down eventually, it'll just take longer before it does. That's great for PLS, another year at these prices will earn them a fortune, and I think that's where the surge is coming from. But those analysts still think the long term lithium price will be bad, which isn't so great for AKE as the bulk of our production will come later. Of course I disagree, while long term pricing will be lower, it's not going to drop down as much as they think. When the bulk of AKE's production comes online there will still be plenty of money to be made.

The problem PLS have is what to do with all this money. Which is a fantastic problem to have of course, but if they want to keep the pedal to the metal they'll need to do something good with it. Hydroxide? I don't think there's THAT much money to be made in higher value products, there's too many chinese converters out there that'll keep things competitive. Moving up the supply chain is good for volatility, as profit margins shift around you'll still be able to make money, it keeps things consistent. But it's not THAT big of a money maker. BHP and RIO didn't get rich by moving into steel production, they just kept mining more and more iron ore. Cheaper and bigger volume than anyone else. The biggest baddest miners are the cheapest and biggest volume, not the most refined end products. AKE has far, far more lithium than PLS does, we can scale more. PLS will have to spend those billions acquiring lithium deposits that we acquired years ago for pennies. While they're burning money on expensive acquisitions, we can use our income more efficiently to develop our big development pipeline.

Now don't get me wrong, this isn't a dig on PLS, it's doing great. As I said, having a big pile of money is a fantastic problem to have, but the race isn't over yet. It's never over, investing never ends. AKE have set themselves up nicely for a marathon. Once these big investment banks start looking a bit longer term I think things are going to even out a bit more.

Just for some perspective, head over to the ASX 100 https://www.marketindex.com.au/asx100 scroll down and sort the constituents by 1 year performance. PLS is 2nd, and AKE is 4th. Considering this crazy, crazy year, that's not bad. Arguing over who is going to make the most money is my favourite investing discussion to have. The lithium producer train is the best place to be right now, be glad you're on board.