PLL General Discussion, page-2143

Well Vod ... you and a small handful of SYA posters do post generally thoughtful/researched/balanced over here on PLL ... the vast majority of our visitors do not, seeking only to disparage other posters & PLL.

I put up the post on general supply/demand curves as an ILLUSTRATION of general market economics and how the relationship between that influences price. It was done in the simplest form as ECONOMISTS use this (starting at a univariate model view and moving to multivatiate). Always starts that way ... change only one variable and keep the rest the same. In reality this is very complex. I mean just take the demand curve for example. Like @WhatsTheTip was noting, those curves are going to not only move to the right but also change their slope and become steeper (now we start talking about price elasticity of demand). This happens because the actual demanf dynamic has changed. Imagine running a multi-billion dollar EV manufacturing plant which you had to shutdown because you couldn't guarantee "supply source" for your lithium salts that your battery supplier needed (because they couldn't source the CAM materials to make a battery). Methinks you'd be willing to pay extra for that. There really isn't "substitution" available at this time. And similarly for supply which is made up of a stack of curves ... what's called a convolution model.

That's my view and why I quoted Ken Brinsden on supply/demand and why he thinks the industry "can't deliver" - not withstanding China's efforts at simply shifting the supply curve to the right with unsustainable Lepidolite and Africa DSO (in normal commerical market not a state operated economy that exists under CCP "rules").

That view needs Gov't support (I'm talking USA & EU (Germany, France, Italy in particular)) to deliver the LOCALIZED supply chain starting with the Cell Makers (Gigafactory battery plants) and working backwards to processed minerals. It wont happen without that ... AND THAT is the MAIN SOURCE of FUNDING (affordable government debt ... like a 10Y T-Bill) for just about all this stuff .... EVEN ALB is getting IRA support.

You say "I just simply do not understand how KP intends to raise the quite considerable funds that are required moving forward in the short to medium term."
I say - get back in touch with PLL - (I'm not being mean but I am being blunt). KP has made several statements ON THE RECORD for the approach PLL is taking for Ewoyaa and TLP and the medium to long term choices available for capital. I'm not going to rehash it (again).

Basically takes us through to your closing paragraph
"Where do you see the cash now coming from to fund all of this with lithium at it's current price? Do you think Piedmont is cash flow negative currently and if so how many quarters of cash does it have left? Do you see a capital raise in the next few months if pricing doesn't improve? (genuine questions Aussie as I value your insight and subject knowledge here)."

That's the challenge right? Where do you see the cash now coming from to fund all of this with lithium at it's current price?
You see the answer with Liontown - yes?? A typical syndicated project finance debt package from COMMERCIAL BANKS simply does not work with Lithium and these prices AND and at these levels of interest rates (note JP commentary this past week about rate cuts - not - higher for longer it appears). So, see above point about Gov't support. If you want a localized supply chain it's going to cost.

Do you think Piedmont is cash flow negative currently and if so how many quarters of cash does it have left?
Loaded question - you're smarter than that. Of course they are Free Cash Flow negatve IF they CONTINUE TO MAKE CAPITAL INVESTMENTS INTO THE BUSINESS (but then so too are many of the Global 1000 as they move through operating growth cycles). So how do you want to handle that ... Operating Cash Flow ... (which assumes of course we want to keep operating NAL which means it might need additional working capital (certainly not "growth capital" ... where's the jaw crusher fit in that scenario)). Could be negative but it depends more on the TSLA OTA than the LG Chem ... and I don't know whether OTA supply has started for either one yet. Looking to the 10K at end Feb/early Mar for guidance. To the 2nd part of that question ... Lots. as much as need.

Do you see a capital raise in the next few months if pricing doesn't improve?
To do what with? For general working capital? Doubt it - they have sufficient cash IMO to operate for several quarters. But this applies to many companies (SYA included ... and unless you subscribed to Champagne Charlie's accounting views, SYA's cash is also a problem)

Net Net, if the big Western Gov'ts fail to protect the Car (EV) producing industries by localizing their LiB supply chain and getting the cells produced in the USA from minerals refined in the USA from (hopefully) ore sourced from "North America" and "friendly jurisdictions" then its game over ... for battery minerals miners, refiners, CAM, AAMs, Cells and the OEMs. It will all be Chinese and that's not BYD is my "dreamworld".