"It stands to reason the coming offtake/financing (and IMO there will be one eventually...) will be substantially worse off than what they could have gotten during the peak of the lithium craze and prices"
I have read this train of thought multiple times, and whilst I agree that the deal wasn't signed and details weren't agreed to when prices are high, the price at which the product will be sold won't be static.
As I see it, both parties will be mindful of where the price is when the deal is signed (likely in the near term when prices are low), and where the price could be when supply gets crunched.
What I think would happen is there will be a 5%, 10%, 20% or 50% discount (who knows) to the lithium price based on some exchange traded index, which may or may not be the Chinese spot price.
Jerko has said he is looking for "the right strategic partner", and it is a negotiation, so who knows, there may even be a floor price, or other conditions that are negotiated in order to protect either party in extreme pricing conditions.
One thing I can assure you is no one in a long term contract is paying anywhere near the highs today, and they probably weren't paying anywhere near the highs at the peak.
My evidence for this train of thought is the fact that PLS kept some of their product in reserve for auction to the highest bidder.
I'm the first to admit that knowledge about AGY or Lithium isn't as deep as others here, but I also like to think that it can allow me to hopefully be more balanced in my reasoning and projections.
AGY Price at posting:
16.5¢ Sentiment: None Disclosure: Held
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