Lithium Miners News For The Month Of June 2019
SummaryLithium prices were slightly lower in June.
Lithium market news - Tianqi: "Lithium demand is solid, prices to stabilize". Joe Lowry: "At best, it is at balance, but not in a huge oversupply".
Lithium company news - Neometals releases a positive Li-ion battery recycling Scoping Study and signs an MOU for an Indian lithium refinery. Altura Mining achieves record production.
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Welcome to the June 2019 edition of the lithium miner news. This past month saw lithium prices slightly lower. Industry leader Tianqi states: "Tianqi: Lithium demand is solid, prices to stabilize." As usual, the past month was packed full of news.
Lithium spot and contract price news
During June, 99% lithium carbonate China spot prices were down 0.52%. Spodumene (5% min) prices were down 0.97%.
Fastmarkets (formerly Metal Bulletin) reports 99.5% lithium carbonate battery-grade spot prices cif China, Japan & Korea of US$11.00-12.50/kg (11,000-12,500/t), and min 56.5% lithium hydroxide battery grade spot prices cif China, Japan & Korea of US$14-15.00/kg (14-15,000/t). China lithium spodumene prices are USD 600-670/tonne.
The charts below, courtesy of Fastmarkets, show lithium prices may have stabilized after falling in H2 2018.
Lithium hydroxide, battery grade, cif China, Japan &Korea
Lithium carbonate, battery grade, cif China, Japan & Korea
Source: Fastmarkets
On June 10, Reuters reported:
LME chooses Fastmarkets for lithium contract pricing. The London Metal Exchange (LME) has chosen Fastmarkets to provide the reference price for its planned lithium futures contract, it said on Monday.
Lithium demand versus supply outlook
On June 10, Investing News reported:
Tianqi: Lithium demand is solid, prices to stabilize...The leader of the Chinese lithium giant said that last year Chinese lithium spot prices decreased significantly, with new supply coming online and the transition to higher nickel cathodes being the main factors impacting prices.....“(Prices) will not go back to the crazy peak seen in the past few years...They will stay at a place where strong players like Tianqi grow, but will be challenging for a lot of new greenfield projects,” Wu said.
On June 11, BN Americas reported:
Lithium prices expected to fall in the short term. Lithium prices will slowly recover from 2021, but in the short term they will continue to fall, analysts gathered at Fastmarkets' Lithium Supply & Markets conference in Santiago, Chile agreed. Vehicle electrification will drive greater demand for lithium at an expected 1Mt by 2025, although the current oversupply situation will not allow prices to recover this year or next, key industry analysts said.
On June 16, Investing News released a video interview worth watching:
Joe Lowry: Lithium sector needs “Big 6” players...“I think 2019 is still a year of a bit of confusion,” he said. “The oversupply myth has really hurt the lithium chemical sector…..At best, it is at balance, but not in a huge oversupply.”
Note: Joe Lowry says at the 9-minute mark - "I think 2019 is a fantastic year to be acquiring the stocks of high quality lithium assets."
On June 19, Investing News released: "VIDEO - Andrew Miller: Lithium industry needs more capital to support demand."
Below are the latest charts released this month from Bloomberg New Energy Finance in their excellent report BNEF 2019 Electric Vehicle Outlook.
Bloomberg NEF 2019 Li-ion battery demand forecast
Source: Bloomberg NEF 2019 Electric Vehicle Outlook
Lithium market and battery news
On May 13, Electrek reported:
Tesla Model Y production will create a battery shortage, says Panasonic. Tesla’s main battery supplier and partner in Gigafactory 1 says that the start of Model Y production next year will result in a battery cell shortage at the factory.
On May 30, The Financial Times reported:
India to acquire reserves of strategic minerals to power the country's move into EVs. India's move to acquire reserves of strategic minerals like lithium and cobalt to power the country's move into electric vehicles is all set to become a reality with three state-owned metal and mining companies due to ink a joint venture agreement early next month....The first acquisition is likely to be finalised within the next six months. Official teams have already visited mines in countries like Peru, Bolivia and Chile, which are rich in such strategic minerals.
On June 4, Bloomberg reported:
These mining superpowers supply the world's lithium. Now they want to make batteries. Almost three-quarters of the world’s lithium raw materials come from mines in Australia or briny lakes in Chile, giving them leverage with customers scrambling to tie-up supplies. The mining nations hope to bring refining and manufacturing plants that could help kickstart domestic technology industries.
On June 12, Mining.com reported:
Pot is taking the spotlight away from lithium and threatening the EV boom. The flow of capital into the cannabis industry is draining investments into lithium producers that supply the raw mineral key to power the electric-vehicle revolution. “A lot of the risk capital that had gone into the lithium sector is now running into cannabis,” said Tobias Tetter. While the market is slightly oversupplied at the moment, it is expected to remain tight, with demand set to reach 1 million tons per year by 2025, from about 325,000 tons last year, according to BloombergNEF.
On June 13, Argus media reported:
LG Chem forms EV battery venture with China’s Geely. The 50:50 joint venture plans later this year to begin construction of a battery plant in China with annual production capacity of 10GWh, LG Chem said today. The factory, the site for which has not been chosen, is scheduled to start operating by the end of 2021. It will supply batteries for the EV models of Geely's car brands in China from 2022. LG Chem and Geely will each contribute 103.4bn won ($87.2mn) for initial funding of their joint venture.....LG Chem, which aims to more than triple its production capacity to 100GWh/yr by 2020, already has an EV battery plant in China's Jiangsu province and has another factory under development in the same region.
On June 17, ET News reported:
SK Innovation to supply batteries that can provide up to 600km of mileage for electric vehicles.....President Yoon. “We are going to finish development of NCM 9½½ (battery that uses an anodic material that has nickel, cobalt, and manganese ratio of 90%:5%:5%) by end of this year and apply it to electric vehicles in 2022.” Perhaps they meant "cathodic" material.
On June 19, Reuters reported:
United States aims to reshape the critical minerals world: Andy Home. The United States has laid out its strategy to rebuild collapsed domestic supply chains for metals and minerals deemed “critical” to its defence and manufacturing sectors. “A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals”, released earlier this month by the Department of Commerce, includes 61 recommendations, ranging from revamping mine permitting rules to stimulating recycling activities to forging alliances with “friendly” suppliers such as Canada and Australia.
On June 22, Reuters announced: "South Korea's POSCO drops plans for Chilean battery material plant."
Benchmark Minerals Li-ion megafactories set for 2025 to supply 22-24m EVs
Source: Benchmark Mineral Intelligence at “The Battery – Inside Out! (Video from the 14:40 mark). Be sure to watch the 2nd Q&A video below.
Lithium miner news
Albemarle (NYSE:ALB)
On June 11, Reuters reported:
Albemarle declines to participate in LME lithium contract. Albemarle Corp, the world’s largest lithium producer, said on Tuesday it will not participate in the London Metal Exchange’s plan to launch a new contract for the white metal, depriving it of a key source of pricing data.
Jiangxi Ganfeng Lithium [SHE:002460] [HK: 1772], Mineral Resources [ASX:MIN], Neometals (OTC:RRSSF) (Nasdaq:RDRUY) [ASX:NMT], International Lithium Corp. [TSXV:ILC] (OTCPK:ILHMF)
On June 4, Neometals announced: "Neometals completes lithium battery recycling scoping study." Highlights include:
- "Scoping Study supports robust economic outcomes for Neometals’ battery recycling process.
- Process recovers cobalt, nickel, copper and lithium as high‐purity sulphate products, with estimated operating cost of less than US$7/lb (US$15/kg) of contained cobalt as cobalt sulphate, before by‐product credits.
- Provisional patents pending in Australia and Europe.
- Pilot test work in Canada on schedule and will be followed by planned Class 3 Engineering and Feasibility Studies."
On June 12, International Lithium Corp. announced: "International Lithium not affected by Argentina Glacier Law."
On June 20, Neometals announced:
MOU with leading Indian power conglomerate to jointly evaluate the development of a lithium refinery in India. Parties to share test-work and evaluation costs for battery grade lithium chemical production. Opportunity for Neometals to leverage its valuable Mt Marion offtake option and lithium industry experience. Manikaran is the third-largest power trading and diversified renewable energy company in India.
Investors can also read my article: "Ganfeng Lithium Looks To Be A Great Buy." Regarding Neometals investors can read my recent article: "An Update On Neometals", and my January 2019 CEO interview here.
Sociedad Quimica y Minera S.A. (NYSE:SQM)
No news for the month.
Investors can read the company's latest presentation here.
(Chengdu) Tianqi Lithium Industries Inc. [SHE:002466]
On June 11, Reuters reported:
Tianqi says happy 'for now' with stake in SQM - President.... Tianqi last December bought a 23.77 percent share in SQM from Canadian fertilizer company Nutrien for $4.1 billion.
Construction is ongoing at their Kwinana lithium hydroxide plant in Western Australia, and is expected to be finished soon.
Livent Corp. (LTHM)[GR:8LV] - Recently spun out from FMC Corp. (NYSE:FMC)
On June 20, 4-traders reported:
Livent: LTHM Kehoe Law Firm, P.C. investigates claims on behalf of Livent Corporation investors. Kehoe Law Firm, P.C. is investigating claims on behalf of investors of Livent Corporation (Livent or the Company). The investigation concerns whether Livent (NYSE: LTHM) and certain officers and/or directors engaged in securities fraud or other unlawful business practices.
Investors can read my recent article "Livent Is Looking Cheap."
Orocobre [ASX:ORE] [TSX:ORL] (OTCPK:OROCF)
No significant news for the month.
Upcoming catalysts include:
- H2 2020 - Olaroz Stage 2 (42.5ktpa) commissioning.
- H1 2021 - Naraha lithium hydroxide plant (10ktpa) commissioning (ORE share is 75%).
You can read the latest investor presentation here, or my article "An Update On Orocobre."
Galaxy Resources [ASX:GXY] (OTCPK:GALXF)
On May 30, Galaxy Resources announced:
Response to recent media speculation. Galaxy Resources Limited is aware of an article published today in the Financial Review titled: “Debt-free Galaxy Resources to back lithium processing plant in China”. Galaxy confirms it has held, in the ordinary course of its business, a number of conversations with various parties about possible co-operation in a chemical processing plant in China. At present all conversations have been informal and are incomplete, and no binding or non-binding documentation has been signed. Galaxy may enter into one or more non-binding arrangements regarding possible co-operation in a chemical processing plant in China should an appropriate opportunity be identified which is worthy of further investigation.
Upcoming catalysts include:
2019 - Sal De Vida partner and construction announcements. Any China conversion plant announcements. James Bay FS.
2022 - Sal De Vida production may begin.
Investors can read my recent article "Galaxy Resources Plan To Be A 100,000tpa Lithium Producer By 2025", and my CEO interview here, and the latest company presentation here.
Pilbara Minerals [ASX:PLS] (OTC:PILBF)
On June 17, Pilbara Minerals announced: "Pilgangoora production and sales update." Highlights include:
- "Production optimisation continues at the Pilgangoora Lithium-Tantalum Project, with record production of 22,375 dry metric tonnes of spodumene concentrate achieved during the month of May, representing ~85% of planned Stage 1 plant capacity.
- While underlying demand for battery-ready lithium chemicals remains strong, delays in the construction, commissioning and build-out of the Company’s offtake customer chemical conversion capacity in China has resulted in June quarter sales of spodumene concentrate being constrained.
- Pilbara Minerals is responding proactively to this market dynamic by working with its offtake customers to accommodate their revised ramp-up timelines plus arranging sales to other strategic customers.
- In response, production at Pilgangoora will be moderated during June and July with the Company utilising this opportunity to undertake continued rectification of RCR defects, complete further plant improvement works, and draw-down final product stocks.
- The previously announced partnering process is well progressed, with the high level of strategic interest received considered to be indicative of the strong medium and longer-term demand for spodumene concentrate.
- Due diligence between Pilbara and POSCO has been completed, with final downstream joint venture and technology licensing terms expected to be agreed by the end of June, and a final investment decision and approvals from both boards anticipated during the September quarter."
Upcoming catalysts:
2019 - Production ramp up.
Q1 2020 - Stage 2 commissioning planned.
Investors can read my recent article "An Update On Pilbara Minerals", and an interview here.
Alliance Mineral Assets Limited ("AMAL") (merged with Tawana Resources)
On May 24, Alliance Mineral Assets Limited announced:
Receipt of listing and quotation notice in respect of strategic placements; proposed issue of shares.
Investors can read the Alliance Mineral Assets Limited company presentation here or a CEO interview here. Alliance has a binding five-year off-take agreement with Burwill Commodity Limited.
Altura Mining [ASX:AJM] (OTC:ALTAF)
On June 5, Altura Mining announced: "Operations update. Altura closes in on nameplate after record month of production." Highlights include:
- "Altura delivers record monthly production of 15,737 wmt in May, representing 86% of planned nameplate capacity.
- Current quarter has delivered strong sales with 24,881 dmt of product shipped, with a further minimum 13,000 dmt scheduled for delivery in June.
- Plant performance continues to improve and is now largely stabilised – allowing focus to move to increasing overall recoveries."
On June 20, Altura Mining announced:
Share sale by Shaanxi J&R Optimum. Altura Mining Limited advises that it has become aware of the sale by Shaanxi J&R Optimum Energy Co. Ltd (“JRO”) of approximately 251 million shares in the company that occurred earlier this morning on the Chi-X trading platform. This represents approximately 11.8% of the issued shares of Altura.
On June 21, Altura Mining announced: "Shipping and operations update." Highlights include:
- "Strong June quarter sales with 38,600 dmt loaded and sold.
- Largest single cargo shipped to date in June totalling 13,700 dmt.
- Daily production rates continue to deliver up to 90% of nameplate.
- Plant performance continues to improve with June production on track to surpass May record."
On June 25, Altura Mining announced:
Altura Mining Limited is pleased to welcome Ningbo Shanshan Co. Ltd (“Shanshan”) as a major shareholder of Altura. Shanshan has acquired approximately 251 million shares in the Company, representing an 11.8% interest, from former shareholder Shaanxi J&R Optimum Energy Co. Ltd.
Investors can read my latest article "An Update On Altura Mining". Investors can also read a company presentation here.
AMG Advanced Metallurgical Group NV [NA:AMG] [GR:ADG] (OTCPK:AMVMF)
On June 11, 4-traders reported:
AMG: Advanced Metallurgical Group N.V. announces authorization to explore a separate public listing for its technologies segment.
Upcoming catalysts:
End 2019 - Stage 2 production at Mibra Lithium-Tantalum mine (additional 90ktpa) to begin.
Lithium Americas [TSX:LAC] (LAC)
On June 6, Lithium Americas announced:
Lithium Americas provides update on the project investment by Ganfeng Lithium.....the Company has been advised by Ganfeng Lithium that it has received all required regulatory approvals for closing the Project Investment.
Upcoming catalysts:
- 2019 - Cauchari-Olaroz plant construction.
- H2 2020 - Cauchari-Olaroz lithium production to commence and ramp to 40ktpa.
- 2022 - Possible 2022 lithium clay producer from Thacker Pass Nevada (full ramp by 2025).
NB: LAC now owns 50% of the Cauchari-Olaroz project and partners with Ganfeng Lithium (50%).
Investors can read my article "An Update On Lithium Americas."
Lithium juniors
Lithium juniors include AIS Resources [TSXV:AIS] (OTCQB:AISSF), American Lithium Corp. [TSX-V: LI] (OTCQB:LIACF), Argentina Lithium and Energy Corp. [TSXV:LIT] (OTCQB:PNXLF), Argosy Minerals [ASX:AGY] (OTC:ARYMF), AVZ Minerals [ASX:AVZ] (OTC:AZZVF), Bacanora Minerals [TSXV:BCN] [AIM:BCN] [GR:1BQ] (OTC:BCRMF), Birimian Ltd. [ASX:BGS] (OTC:EEYMF), Critical Elements [TSXV:CRE] [GR:F12] (OTCQX:CRECF), Dajin Resources [TSXV:DJI] (OTCPK:DJIFF), Enigri (private), Eramet (EN Paris:ERA) (OTCPK:ERMAY), European Metals Holdings [ASX:EMH] [AIM:EMH] [GR:E861] (OTC:ERPNF), Far Resources [CSE:FAT] (OTCPK:FRRSF), Force Commodities [ASX:4CE], Infinity Lithium [ASX:INF], Kidman Resources [ASX:KDR] [GR:6KR], Latin Resources Ltd [ASX: LRS] (OTC:LAXXF), Lithium Australia [ASX:LIT] (OTC:LMMFF), Lithium Power International [ASX:LPI] (OTC:LTHHF), LSC Lithium [TSXV:LSC] (OTC:LSSCF), MetalsTech [ASX:MTC], MGX Minerals [CSE:XMG] (OTC:MGXMF), Millennial Lithium Corp. [TSXV:ML] (OTCQB:MLNLF), Neo Lithium [TSXV:NLC] (OTC:NTTHF), NRG Metals Inc. [TSXV:NGZ] (OTCQB:NRGMF), North American Lithium (private), Piedmont Lithium [ASX:PLL] (PLL), Prospect Resources [ASX:PSC], Rock Tech Lithium [CVE:RCK], Sayona Mining [ASX:SYA] (OTCPK:DMNXF), Savannah Resources [LSE:SAV], Standard Lithium [TSXV:SLL] (OTC:STLHF), Sigma Lithium Resources, and Wealth Minerals [TSXV:WML] (OTCQB:WMLLF).
Global X Lithium & Battery Tech ETF (NYSEARCA:LIT) - Price = US$26.11.
The LIT fund moved up for the month of June. The current PE is 18.77. Given lithium demand should rise ~4-5 fold between now and end 2025, the lithium sector PE of ~19 looks to be good value.
SOURCE: Seeking Alpha
Conclusion
June saw lithium prices slightly lower. Industry insiders see prices stabilizing as demand remains strong.
My highlights for the month were:
- Tianqi states: "Lithium demand is solid, prices to stabilize."
- Joe Lowry - "I think 2019 is a fantastic year to be acquiring the stocks of high quality lithium assets."
- Andrew Miller: Lithium industry needs more capital to support demand.
- Pot is taking the spotlight away from lithium and threatening the EV boom.
- India to acquire reserves of strategic minerals to power the country's move into EVs.
- LG Chem forms EV battery venture with China’s Geely (OTCPK:GELYF).
- SK Innovation to supply batteries that can provide up to 600km of mileage for electric vehicles using NCM 9½½, by 2022.
- Neometals - Positive Li-ion battery recycling Scoping Study. MOU to jointly evaluate the development of a lithium refinery in India.
- Pilbara Minerals - Production at Pilgangoora will be moderated during June and July to allow for Chinese conversion capacity to catch up.
- Altura Mining reports record lithium production.
As usual, all comments are welcome.
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