I think you should remember when posting Fastmarket charts to indicate that it reflects the pricing from very few participants in the lithium industry and therefore is likely to be inaccurate.
It has been rejected by the majority lithium suppliers.
Read about why it has been rejected by them here.
https://*********.com.au/pricing-concerns-divide-lithium-cobalt-markets/
Tianqi, Albemarle and SQM and others are not willing to participate and therefore the vast majority of the world's lithium is not factored here.
These 3 probably account for 70% of supply of both hard rock and brine.
Feel free to continue to refer to the graph, by all means, but you are going to need a lot more data points that this.
Without the majority of suppliers on board it is likely to be a poor representation of real deals.
It has been gamed and controlled. It is already discredited and ignored.
Quotes from article -
“The challenge of the index is to try to have very good representation of the market, which I really feel is not possible today because of how the lithium industry works,” SQM vice president of lithium and iodine Pablo Altimiras, who spoke alongside Mr Ryan on a panel at the conference, said.
Albemarle head of corporate strategy and investor relations David Ryan told attendees at the Fastmarkets Lithium Supply and Markets Conference in Chile last month that the company would not be contributing its pricing data to the index “at this point”.
“An exchange contract tends to support a commodity market, and that’s not what we believe this (lithium market) is,” Mr Ryan said.
Another panel member representing rival producer Tianqi Lithium Corp agreed that lithium is not a true commodity.
Other established producers have said they believe lithium is a specialty chemicals market that should be priced on a contract-by-contract basis.
Read that last bit again.
Fastmarkets is simply an attempt to turn a specialty chemical sector into a simple mineral commodity story and quantify it like iron ore.
LME did not want to get their own reputation tarnished so have out-sourced the job and its not worth the pixels it uses on the screen.
This is not how this sector works. It is contract by contract. Supplier to customer.
Opaque pricing deals dependent on quality, impurity levels, grade, final product and volume.
Using your graph to indicate the exact pricing environment that Galaxy is part of may be entirely misleading.
I am starting to miss Deutsche Bank already.
They were the last of the big banks to provide a bible-sized reports on the lithium sector.
There is no bank institution left that goes into the same level of detail.
Analyst and report budgets have been slashed at the banks over the last couple of years and the lithium sector is now poorly represented with these kinds of simplistic and unrepresentative graphs and 2 paragraph down-ramps.
DYOR
PLS has recently reported pricing of US$600-640. I think it's easy to predict what GXY will be getting for its spod in the last half of CY2019 with very high accuracy, IMO.
