In Liontown’s October 2023 capital raising presentation, they mentioned that they were considering adopting a hedging policy, to manage currency exchange risks and a sustained downturn in spodumene price. Implying they had discussed but had not yet implemented any formal strategies at that time.
Given the ongoing volatility and recent price declines, is it plausible that Liontown could have since arranged some form of price protection through re-negotiating pricing floors, or pricing mechanisms linked to the spot price and the last quarters reported all-in sustaining costs?
While there’s no public confirmation yet, such arrangements would only appear when triggered or in quarterly or annual reports once finalised. In other words, you have no reason to see it until it smacks you in the face…punters forecasting a possible loss of $450 per tonne or a $45million burn after production costs for the next quarter or worse may be wrong footed….
Investors might want to watch upcoming announcements or the next quarterly for any updates on risk management measures related to lithium pricing.
** All IMO, purely speculative, based on the assumption that managment are exploring ALL options, not just the worst ones…not based on any material knowledge. **
LTR Price at posting:
61.5¢ Sentiment: Buy Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)