Ann: Rock chips expand known lithium mineralisation at Pontax, page-21

Interesting commentary from one of our close neighbours, Allkem (via St**kh**d this morning) in support of a continuing structural deficit with lithium. Allkem have the James Bay project ~50km north of Pontax.

Full article at https://st**kh**d.com.au/resources/ground-breakers-dont-cry-for-allkem-the-argentine-and-aussie-lithium-miner-whose-prices-still-sing (replace key words)
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The higher ups at Allkem remain confident in the lithium market, saying they continue to see strong demand for their products from converters in China and elsewhere.

Allkem’s chief sales and marketing officer Christian Cortes told analysts on the company’s quarterly call this morning they expected demand for lithium to be constrained by supply until 2030.

“The constraints in terms of production for a variety of reasons are expected to continue and also the pressure on costs are expected to continue,” he said.

“What we had as floors in the past is not relevant at all, for the future. If you’re trying to see where prices could go in the future … I don’t really want to go in that area.

“But what is clear is that for the foreseeable future, and these are not straight lines — the line of production and the line of consumption — but for the foreseeable future, probably by 2030, what we see at the moment, demand will be constrained by supply.

“And at this stage, we don’t see any reason why if we were to indicate a floor, we don’t see any reason why the market will actually reach those floors, because there is constrained production.”

Cortes expects growth in EV and lithium demand to continue into 2023, despite negativity about the Chinese market.

“The main driver of this growth, electric vehicles, continued its breakthrough into the mainstream, with global full years sales estimated to be approximately 10 & 1/2 million units, representing year over year growth of 56% or 3.7 million units,” he said.

“To put this in context, the (Chinese) market grew more in a single year last year than the entire market in 2020, two years prior. This growth is expected to continue into 2023."

“Despite some concerns about the lingering impact of COVID-19 and the potential for global recession, consensus EV unit sales growth in 2023 is forecast to be similar to 2022 to around 3.6-3.7 million units, with an increasing proportion of this expected to come from Europe and North America.

“This is an encouraging sign as both EV and lithium demand growth becomes more diversified and widespread.”

Despite pressure on spot prices, which exceeded anyone’s expectations in 2022, Cortes says customers continue to ask for more volume and quicker shipping, with long term contract pricing expected to trend upwards.