PLS chart, page-22969

Certainly no signs of ‘spring’ in this winter of lithium value eradication :/

From the AFR today


Read the story

Spoiler : Here

https://www.afr .com/companies/mining/the-only-profitable-lithium-mine-in-australia-revealed-20240903-p5k7gh
The only profitable lithium mine in Australia revealed
Elouise FowlerReporter
Sep 4, 2024 – 5.00am


Every Australian lithium mine is losing money at today’s prices except for Western Australia’s famously low-cost Greenbushes, which could withstand a deeper commodity price rout, according to broker Citi.
Greenbushes is a joint venture 49 per cent-owned by US-listed Albemarle, and 51 per cent by ASX-listed IGO and China’s Tianqi.

The Greenbushes mine is owned jointly by IGO, China’s Tianqi and Albemarle. Getty
The world’s biggest hard rock lithium mine is the only one of Australia’s seven producing lithium projects to be profitable, the broker argued, based on its analysis of their running costs at spot prices.
UBS warns the lithium sector will face a wave of mine closures as prices for the battery material struggle despite some companies putting projects on ice to sit out the bear market.

Prices for the lithium ore typical of Australia have collapsed more than 23 per cent over the past 45 days, fetching $US720 a tonne ($1066) on September 2, according to S&P Global’s Platts. That ore, which is spodumene concentrate with 6 per cent lithium content, was fetching more than $US8000 a tonne in 2022.
Citi was puzzled that no major cuts in supply, known as curtailments in industry shorthand, had been declared in Australia, given the lithium spot price is trading at half the long-term consensus price of $US1500 a tonne. Last month, Arcadium flagged it may have to shut Mt Cattlin.
For investors, it was a matter of whether long-term assumed prices are too high, or whether lithium companies are “just poorly run”, the broker speculated.

Citi examined the seven Australian mines using analysis popularised by gold miners to arrive at a breakeven figure known as an all-in sustaining cost including freight and royalties.
Greenbushes can still make a profit if the spot price reaches $US750 a tonne, Citi found.

The remaining six mines – Pilgangoora, Mt Cattlin, Wodgina, Bald Hill, Mt Marion, and Kathleen Valley – all screen as loss-making.
With expansion capex factored in, Liontown’s Kathleen Valley is the least profitable of all, only breaking even when the spot price exceeds $US1500 a tonne. Excluding that growth capital, the mine is profitable at around $US900 a tonne.

Mineral Resources’ Mt Marion, which it half-owns with China’s Ganfeng Lithium, is second from the bottom, achieving breakeven when prices exceed $US1400 a tonne. When growth is not included, the implied breakeven price is $US1300 a tonne.

Citi acknowledges that as operations get larger, the costs of several producers such as Pilgangoora and Wodgina will improve with economies of scale.
The analysts relied on a June quarter average spodumene price of $US1153 a tonne.
Lithium prices are forecast to reach their low in the December quarter, but that is contingent on further supply cuts to rebalance the market. Australia’s seven lithium mines account for around 35 per cent of global supply, Citi estimates.

Good on PLS for gritting its’ teeth (and baring them?) and pressing on despite that powerful alliance between SQM and Codelco in Chile https://www.mining-technology.com/news/codelco-sqm-enter-partnership/ that’s done its best to turn the once mighty Tianqi into a toothless tiger.
In the global ‘game of giants’ I‘m thinking it will be interesting to see the next alliance moves. and if they involve PLS in any way.

And at $2.65 PLS is currently priced at lows not seen since that determined UP trend of August 2022 .

GLTA and cheers (?)