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AVZ secures lithium feedstock deal with China's Tianyi

Published date: 30 March 2021
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Australia-based AVZ Minerals has signed a three-year deal to supply lithium spodumene concentrate to Chinese lithium producer Yibin Tianyi from its Manono lithium and tin mine in the Democratic Republic of Congo (DRC).
Tianyi will buy up to 200,000 t/yr of spodumene concentrate for an initial three-year term, with an option to extend for another two years.
Prices will be on an US dollar cif China basis determined by a formula that references various published market prices of lithium carbonate and lithium hydroxide products and underpinned by an agreed floor price.
Higher demand from the downstream industries, particularly the electric vehicle power battery and 5G telecommunication sectors, has prompted industry participants to accelerate construction of lithium salt facilities. Chinese salts producers are aiming to secure feedstock supplies from the global market.
Tianyi has a production capacity of 20,000 t/yr for lithium hydroxide. It last week secured a five-year offtake agreement with Australian lithium producer Pilbara Minerals and in January expanded its lithium concentrate supply agreement with Brazil-based lithium mining firmAdvanced Metallurgical Group.
AVZ has also signed long-term lithium offtake agreements with Chinese lithium producer Shenzhen Chengxin and Ganfeng.
More than 80pc of the intended annual spodumene concentrate saleable product from the Manono project is now contracted under binding offtake agreements, AVZ said.
Argus assessed Chinese lithium hydroxide prices at 68,000-73,000 yuan/t ($10,350-11,110/t) today, up by Yn3,000/t from 25 March, with the range for lithium carbonate rising by Yn1,000/t to Yn85,000-89,000/t today, boosted by higher demand from the power battery sector.​