Day to day discussions on S/P, page-12505

IMO, there's 2 important considerations provided in yesteday's ann;

1. Why is converstion capacity lagging - My view is the respective battery chems are an issue at this early stage. The Li feed for high Nickel NCM 811 batteries is hydroxide, but it seems the converters have delayed or are delaying expansion investment for this product line, as feed for NCM532 & 622 can be hydrox or carb. Noting many of the converters are already invested and tooled for carb production, adding to that, the feed for LFP batteries used for commercial EV's (busses, trucks) also requires carb. Thus hydrox capacity derived from SC6 obviously isn't there yet, possibly converters timing hyrox production in line with US & EU OEM's mass production starting next year and in a big way from 2021.

2. The comments in the ann relating to stage 1 & 2 offtake availability (previously sold out) - I'll be keeping my eye on this development, but it does imply the PLS, GF & GL offtake agreements are not one-sided in favour of the converters (unlike some on hear are suggesting), in that the converters have reneged on those long term contracts (in part), and as a result, PLS has the right to establish new offtake agreements, with new customers.

There's a 3rd consideration, which could be revealed on completion of the partnering strategy, but will leave at that for now.