It’s easy to blame Glencore, but the possible truth may be that...

It’s easy to blame Glencore, but the possible truth may be that they are innocuous in this situation. New information has come to light over the last few months suggesting that the idea of “multiple buyers” was not fully elucidated right from the start.

Have a listen to what is required for product qualification. Once you realise that adding lithium chloride from Galan to any carbonate stream likely invalidates previous product qualifications because it changes the impurity profile, it is of no surprise that anyone with a working carbonate plant would not want to take it.

To explain further; Galans LiCl will most likely lower conversion costs because of its better quality. However, I think a lot of us got fixated on this point. What we really should have been focused on is product consistency and supply chain risks. The argument here is that the lower production costs Galans brine allows cannot adequately offset the risks that using an external source of brine entails, especially when the company doesn’t have a long track record of successful production of a consistent product. If I’m right, no matter how good their product is, no carbonate producer will want to buy it, which means that until export permits are granted the only buyers are commodity traders.