New Lithium Related Article, page-920

The Lithium Boom Has Only Just Begun


NEWS PROVIDED BY

NetworkNewsWire
08:30 ET


NEW YORK, October 2, 2018/PRNewswire/ --

NetworkNewsWire Editorial Coverage

Despite short-term gyrations, the outlook for lithium continues to shine. Electric mobility is still only in its infancy. Revolutionizing how we commute and power our lives, the inevitable tsunami of electric vehicles and burgeoning demand for energy grid storage are driving lithium demand for the foreseeable future.

• The electric revolution is still in its infancy.
• Lithium demand expected to triple in next seven years.
• Lithium stocks could surge with demand.
• Junior miners offer big upside potential.

Anticipation of an exponential increase of electric vehicles coupled with expanding demand for lithium-ion (L-ion) batteries drove the lithium mining sector to reach all-time highs last year. Lithium shares swooned at the beginning of 2018 on a negative oversupply forecast by Morgan Stanley analysts. That forecast has since been widely debunked by a broad range of lithium industry experts and given only a 1 percent chance of happening. As the world inexorably advances into the new electric power paradigm, the lithium sector should experience an excellent decade and produce outsized returns. Demand for raw battery materials continues to grow at an unprecedented pace, and lithium miners could easily rack up further gains and reach new highs.

Lithium Demand May Exceed Expectations

Reflecting the scale of the impending energy revolution, respected independent commodity forecaster Roskill tripled its demand forecast for lithium through 2026. Two years ago, Roskill forecast demand would increase to 328,000 metric tons of lithium carbonate equivalent by 2026; now the commodities expert has revised the outlook and expects demand to explode to more than 1 million metric tons by then. However, lithium supply expectations fall far short of forecasts. In 2018, the total lithium production will total only around 280,000 metric tons of lithium carbonate equivalent - a far cry from what's needed.

A wild card in the quest for lithium feedstocks is China, which already controls 55 percent of global lithium-ion battery production. China plans to deliver about 3.5 times more gigawatt-hours of battery cells a year than the Tesla Gigafactory and is expected to command 65 percent of all production by 2021. China also has been pushing hard for clean energy and intends to flood highways with 5 million electric vehiclesby 2020. As electric autos and energy storage solutions surge, indications are that lithium may soon become the most important energy commodity in the world.

Juniors Should Shine

Many believe that the majors just won't be able to produce enough lithium to meet global demand. Select junior miners are likely to be the beneficiaries and could produce exceptional returns.