1. The growing lithium market is hydroxide, we can agree on that...

1. The growing lithium market is hydroxide, we can agree on that and I have posted as such. Refer: Post #: 38039838 I have always said the best batteries are made from lithium hydroxide but batteries can still be made from carbonate (albeit poorer performing batteries btw but price is a key factor - refer point 8 below). I have gone through battery specifications in the past as well and myself and 8horse are probably in agreement there btw. In terms of solid state batteries they will be a game changer if they can deal with the stability issues of a solid electrolyte and both the cathode and anode in effect been conducive to been lithium based - discussed from this post and a number of the others that follow this one Post #: 39255454.

2. We can agree there is few good deposits that can supply the hydroxide market - it is why I am invested in AVZ like you. The key to timing is whether the capex spend of PLS reduces its deleterious elements, but time wil tell. Chemical grade lithium, which is what supplies batteries IMO needs Fe203 cont below 1%, preferably 0.8% Fe203. That can be converted to hydroxide IMO. CG is what we are generally talking about when we talk 6% grade spodumene. I have provided numerous posts in the past talking about clinkers and the like as to why deleterious elements below this are a key - Post #: 39850021.

3. Agree with your comments on moisture content - is always a problem for PLS given the dust policy of where they are exporting from - refer here Post #: 39861091 and this link page 6:
https://www.der.wa.gov.au/images/documents/our-work/licences-and-works-approvals/Applications/Attachment_3A2_-_Pilbara_Minerals__proposal_for_spodumene_concentrate_export_A1570258.pdf

Ironically, if AVZ does go down the HMS route only and then adds floatation later the moisture levels in its sales will be very very very low (refer embedded post above)

4. Technical grade lithium has different specifications depending on end use. The higher end uses actually source technical grade spodumene from Greenbushes of 6.5% to7.5% grades. These grades are well below 0.8% Fe203 count from recollection. Greenbushes also produces some lower quality spodumene concentrates of less than 6% - they call these technical grade to but they are more used for industrial greases from recollection frommy readings. This Post #: 39957024 gives TG grades, going back to above embedded posts gives the specifications of technical grade and chemical grade carbonate/hydroxide in downstream markets.

5. If we are in production end 2021 I will be very surprised, but pleasantly surprised. As a more conservative poster on here missed timelines have IMO made 2021 not achievable given we still do not have a DFS nor equity for offtake agreements. Financing a key if want 2021.

6. Going back to 1, when I talk 2025 I am saying that I see AVZ coming into production by then. The fact is it is about supply and supply responses and the underpinning EV demand, and need for good quality spodumene concentrate. The problem though is Greenbushes has expanded, and Albermale/Tianqi still have mine expansion options there including expanding the hydroxide facilities they are respectively building at Kmerton and Kwinana. The market is pricing AVZ as if it will not be in production by 2025 which I have specified previously - Post #: 37646469 - and contained in this embedded post I have stated a view the earliest I see AVZ in production is 2022 if it gets its act together (and the gigafactories start coming on stream and sourcing spodumene). It is actually why I started the Understanding Lithium Demand thread.

7. I have provided numerous commentary on demand forecasts, and feel entry to market on a lrage scale basis is getting closer to 2025 than 2022 unless EV activity picks up, the supply gap is closed and the gigafactories start seeking to secure high grade product. It will be very interesting what happens the next 6 months because that will determine when exactly we expect AVZ to enter the market. I can certainly see AVZ installing a 2 mtpa ore feed facility around 2022/23 if AVZ gets its house in order or slightly earlier, i.e. producing equivalent to 325,000 to 425,000 tonnes of 6% grade spodumene depending on whether HMS only or with floatation configuration, but it is the ramp up to 5 mtpa that is the key, because that means producing more than 1 million tonnes of 6% grade spodumene. When I refer to 2025 I refer to configurations of 5mtpa capacity or more. So here is the question - what scale do people see AVZ enterring the market and by what date and when do they see ramp up to 5 mtpa and beyond. And obviously transport a key here - and just to provide some estimates - moving 1,000,000 tonnes of 6% grade spodumene by road to a rail head at a truck capacity of 40 tonnes equates to 25,000 truck movements per year (one way) or 68 movements per day or 2.9 movements per hour one way (before we include return journey and extra truck movements for any feedstock to the spodumene process (such as chemicals that need to be moved to site). Hence why transport is a key - certainly at 2mtpa ore feed capacity the issues of transport are less in terms of transport infrastructure, hence why timeframes to market on a large scale are embedded in transport strategies and to this end transport solutions are been developed by others hence AVZ's development plnas (i.e. teh grand plans at 5mtpa and beyond are held captive by what otehrs do in providing transport solutions to AVZ).

7. We can agree to disagree, but been a conservative poster and seeing what is happening to prices all I will say is that when the market re-calibrates I would be expecting prices of good quality spodumene to settle in the US$600 - US$700 range. Why - well your battery accounts for a 40% of the upfront cost of an EV to start with. Noting there are 6.5 tonnes of 6% spodumene concentrate in a tonne of lithium hydroxide monohydrate at a US$700 per tonne 6% grade spodumene price this equates to an input cost alone in the converter process of US$4,550, then add the conversion costs and you are talking a hydroxide cost of some US$7500 per tonne to US$8,500 per tonne (meaning a converter needs to be able to sell hydroxide above US$9000 per tonne to make a profit). That is before the battery is made. Spodumene prices of north of US$900 per tonne essentially mean that EV demand will not be able to follow trajectory growth rates because to reiterate EV take up increases as price of EVs fall, and one price that cannot increase too much and a key to cheaper batteries is for spodumene prices to be set at an appropriate level that doesn't impact the takeup of EVs. It is why in my post I state when the market matures, which is what I expect to happen here, is low grade high opex cost spodumene operations will die. With exceptional waste to ore ratios (less than 1), low opex cost at minesite hence transport costs a key and high grade it is why I see AVZ been of teh scale or better than Greenbushes so I have always seen AVZ as getting to market, it is simply a case as to what configuration it comes to market prior to 2025, but beyond 2025 (as transport solutions improve in the DRC) Ican see AVZ certainly producing at a configuration of 10 mtpa ore feed capacity. It is why I have a long term perspective here.

8. Turning to 7, ultimately consumers will decide EV takeup (and price of EVs will be a critical factor). What consumers want are batteries that don't need recharge for 250km plus IMO, but do not want to pay through teh nose for them.

Finally drank a few VBs writing this - ultimately the above is IMO and everyone needs to DYOR. Time will tell.

What tomorrow brings will be.

All IMO IMO