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Lithium shortage, page-41

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kelgart

1 Posts.

26/08/16

17:39

Post #: 18720318
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Originally posted by airconditioner ↑

The shortage is real.
There is 60kt of carbonate production from spodumene being added right now in China.
2 established players upgrading 20kt each and 2 new chemical companies deciding that it's time to enter the sector.
This extra processor demand would require yet another Mt Marion and another Mt Cattlin to come online next year and still not have enough spodumene for the newly added capacity, let alone the existing processors.
There is no new product coming for them and the battery orders are still coming.

Where are the new mines to satisfy even the existing demand?
PLS may begin production in 2018. Who knows if that will even happen?
No DFS or permitting or finance in place for the mine as yet.
Even if they get a move on they may not produce quantity until 2019.
Altura are tiny and Nemaska don't appear to be targeting Chinese demand at all.

Jiangsu has contracts and supply but has to stop production of carbonate to upgrade and fix the plant.

Every indication from the industry insiders like Joe Lowry is that lithium price will surge again in Q4.
This is probably why Galaxy decided to hold some Q4 supply for the spodumene spot market to at least keep some of the smaller independent spodumene processors alive and get premium pricing.

Canaccord has been conservative in guestimating that $700/t will be the new price for the next 120kt.
The market is probably quite ready to pay quite a bit more than this. We'll see soon enough.
China shows no signs of slowing down the mass exodus from fossil fuel driven transport.

Galaxy is way too cheap for the position that we are in.
They were cheap at 50c and the prospects have only got better since then.
Take advantage of the shorter's discount while you can.
Once we start shipping we enter a new league.

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When Galaxy will start shipping?

GXY Price at posting: 37.5¢ Sentiment: None Disclosure: Not Held
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Lithium shortage, page-41

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