The trade war has certainly had an impact on Chinese...

The trade war has certainly had an impact on Chinese manufacturing. However their EV quality is poor compared to Tesla. It will be interesting to see how VW and BMW compare.

WA hard rockers fortunes are linked to Lithium Hydroxide (LiOH) production and 2019 has seen the rapid increase in NCM811 EV battery production. It also saw the Chinese adopt lower performance LFP Batteries catered for by lower grade SQM dumping. Tesla use NCA EV batteries and I wonder if they will consider transferring to NCM811, if only for their Chinese production?

Noted Lithium sector commentator, Rodney Hooper bought out a presentation for the recent "Mines and Money" seminar:

https://www.linkedin.com/feed/update/urn:li:activity:6606226141416169472
if you have trouble viewing, increase the zoom on your page settings.

Specifically he notes WA hard rock miners costs of production (COP) and consistent quality, as their current hurdles.

He notes OEMs are pushing for EV battery producers to breach the USD100kWh barrier ASAP. I can't help but feel that this is putting pressure on all aspects of the costs of EV battery production, including materials costs. Also that the barrier will be breached by virtue of the scaling of EV battery production.

He states OEMs are demanding higher quality of materials. Presumably Chinese EV customers found the trade off between lower quality product for higher $ subsidies satisfactory but no more.

He states a shortage in production of quality LiOH is impacting future production of NCM811 EV batteries creating a chicken and egg scenario. Scaling of production is needed to reduce overall costs to meet OEM demands but quality of raw material is not here to do so.

If Lithium accounts for only 2 to 4% of an EV battery cost, then surely its cost for EV battery manufacturers becomes largely irrelevant.


I am confident that PLS will achieve nameplate recoveries, the real question is when? AJM have recently achieved it.

PLS can produce on spec Spodumene, the real question is at what COP? Will DFS estimated COP prove achievable?

RH mentions in his article the invaluable level of Greenbushes experience in Spodumene production. AJM are achieving it with their orebody now and I'm sure PLS will similarly achieve it with theirs. They share the same resource but with different ore structures. AJM appear to be concentrating on coarse ore while PLS concentrate on fines. It seems to be these two have something to offer each other. Egos have been mentioned for preventing a merge in the past but if they really wish to do something good for SHrs, they should consider merging. Synergies realised will go a long way to jumping their current hurdles.

In summary, our nameplate recovery and COP will get there ... and prices for quality Spodumene have to rise, as scaling of NCM811 battery production increases. As our COP fall and Spodumene prices rise, then our SP will follow.

Further, the EV disruption is getting there as EV quality increases to meet customers expectations.