"However struggle with your optimism for PLS due to Tianqui's problems. Aren't you concerned that Tinqui's spodumene mine and LiOH conversion assets could be sold to a competitor of PLS below replacement cost? The best spod mine in the world isn't going to stop producing ... but a change in ownership may result in the new owners having a lower (still) cost base. How can that benefit PLS?"
I'm very confident that our offtake partners will honour their agreements when/ as their own conversion plants get built or expanded and demand recovers, we have offtakes for everything we can produce up to the mills current capacity and beyond, we also minimum prices for what we do sell although the lower grade stockpiled product won't benefit from that. So what happens with Tianqui's assets or offtake arrangements are of no great concern for me...it will take some time to get to some art of balance between supply and demand.
"ALB and Tinqui halting capital works on conversion plants? ... how is less LiOH conversion capacity beneficial to PLS? Especially when KB repeated claimed that "bottleneck" conversion capacity was what was harming PLS? "
In a nutshell the conversion bottleneck is resolving itself by the huge reduction in Sopdemene supply, which of course is hurting all producers, most of the hurting has already been done . Going forward is the only thing that matters for PLS now, and our offtake partners are expanding their conversion capacity as others reduce theirs. At some point in time as EV demand picks up any lack of conversion capacity should be good for Sopdemene prices, initially at least and will eventually lead to more spod production as that gets resolved, and so it goes on...
There is no perfect answer but I'm relaxed about PLS's ability to hang in there for the long haul which is all that matters IMO, bound to be a few more hickups along the way..generally the best cure low prices is low prices themselves , however it takes time and the important to use that time wisely and still be there when it turns.
Cheers Whisky
PLS Price at posting:
26.5¢ Sentiment: Hold Disclosure: Held
(20min delay)