Just as I was guessing on environmental concerns about processing methods in China of their own lepidolite-based lithium which they have so abundantly, and researching CGF dot com. ...
what do I find?
Lithium Futures Jump: Potential Supply Disruption Looms Over Lithium Market
The lithium carbonate futures in China experienced a sharp increase on Wednesday due to market speculation surrounding potential environmental inspections that may limit operations in Yichun a southern province of Jiangxi.
Concerns center around YongXing’s Yichun lepidolite mine, whose impact could significantly disrupt the supply-demand balance. While the Ministry of Ecology and Environment cleared the mine after an earlier investigation, unconfirmed reports suggest dissatisfaction, raising the possibility of another review in April 2024.
Despite environmental uncertainties, current low lithium prices may pause production at some lepidolite-based operations. However, it's uncertain if YongXing will reduce production, warranting caution until clarification.
Industry sources note that production costs of lithium carbonate in Jiangxi's lepidolite mines vary: below 0.4%, costs range from CNY 120-150kt/LCE. For 0.4%-0.6% concentration, costs are CNY 80-100kt/LCE, while over 0.6% maintain costs within CNY 80kt/LCE.
It has been suggested that YongXing breaks even at CNY 60kt/LCE, implying that the mine may not shut down solely based on current prices but could be impacted by temporary environmental concerns.https://www.linkedin.com/posts/claes-orn-3866b16_chinas-lithium-carbonate-futures-jump-on-activity-7166029766213496832-km-O?trk=public_profile
My guess is the environmental concerns are far from temporary. The Chinese are mad for pegmatite-based Li but trying to keep it on the down-lo.
They have to stop polluting themselves into oblivion as well.
AZS Price at posting:
$3.53 Sentiment: Hold Disclosure: Held
