Day to day discussions on S/P, page-1978

The reason prices have been going lower in China is due to the grade of lithium not meeting the specs required. So they are paying less for an inferior product (sounds like it's been SC5) that will cost more to refine to meet the requirements. Makes sense....

When PLS, AJM, and TAW are sending SC6 over they won't need this lower grade and will happily take the SC6 that meets their requirements. I actually think it's going to be really hard for explorers to get the finance to build more lithium mines. Maybe AVZ will make it but I would predict that won't come online until 2021/22 and by then it will be needed due to demand. AVZ also needs to raise funds, has over 2B shares floated, and owns 60% of the project. PLS will upgrade to 5MT and is well positioned with timing and execution, financing pretty much all sorted for the 5MT operation.

Now onto brine vs hard-rock. Lithium hydroxide is preferred now for the batteries. Therefore, brines producing lithium carbonate still need to turn it into lithium hydroxide. This process is more expensive for brines than hard-rock. Hard-rock into SC6 then straight into lithium hydroxide is I think 15-30% cheaper to convert than brines lithium carbonate. So they work out to have similar costs once this is taken into consideration. With the crazy weather patterns happening globally hard-rock is a safer choice between the 2 with weather elements affecting brine substantially.

Lastly, people saying they are worried about the lithium industry really surprises me. For me the EV industry and battery power storage systems are only going to grow at incrementally large rates. Global warming and dirty air is going to help the transition. EVs are far superior and when the cost of them come down further no one will want a ICE because it will cost more. If there was another GFC this would have to be one of the best industries to have your money parked in. So many cities globally have awful air pollution, especially China and they won't stop until it is fixed. The air pollution negatively effects economies and creates a strain on the health budget.