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Welcome to the December 2022 edition of the lithium miner news. The past month saw lithium prices fall back a little after about 2 years of almost continuous gains. It appears lithium demand is expected to fall a little in Q1, 2023 as China EV subsidies end in 2022.
We also saw lithium stocks harshly sold off in December as if the sky is falling!!! More on this in the conclusion.
Congratulations to Sayona Mining and Piedmont Lithium who this month have been upgraded to the lithium monthly news from the lithium junior news (as they will become lithium producers in either Q1 or Q2, 2023).
Asian Metal reported during the past 30 days, the 99.5% China lithium carbonate spot price was down 4.06% and the China lithium hydroxide price was down 3.77%. The Lithium Iron Phosphate (Li 3.9% min) price was down 2.43%. The Spodumene (6% min) price was down 1.45% over the past 30 days.
Benchmark Mineral Intelligence reported China lithium prices of (battery grade carbonate – RMB 557,500 ($80,275), hydroxide RMB 560,000 ($80,650), and Benchmark stated (paywalled): “Cathode manufacturers continued to work through inventory rather than purchasing new material whilst waiting for clarity over the price trend, weighing on demand for battery grade carbonate from converters…amid reports to Benchmark that consumers remain cautious about Q1 2023 EV sales expectations in China.”
Note: The lithium price falls in CNY were in some cases a rise when converted into USD. For example, last month Benchmark reported: “hydroxide RMB 564,000 ($79,525).”
Metal.com reported lithium spodumene concentrate (6%, CIF China) price of CNY 38,411 (~USD 5,496/mt), as of December 22, 2022.
On December 14 Pilbara Minerals reported the results of their latest 10,000t spodumene BMX auction achieving an equivalent price of US$8,299/DMT (SC6.0, CIF CHINA).
China Lithium carbonate spot price 5 year chart – CNY 547,500 (~USD 78,341)
Wood Mackenzie’s lithium price forecast – July 2022 (Source)
Mineral Resources presentation courtesy Wood Mackenzie
2022 – UBS lithium demand v supply forecast to 2030
Lithium demand v supply forecast by Benchmark Mineral Intelligence (mid 2022 forecast)
Fastmarkets lithium demand v supply forecast (as of 2022) (Source)
Stockhead courtesy Fastmarkets
BMI (Q2, 2022 forecast) – Lithium demand to exceed supply mostly this decade
Winsome Resources courtesy BMI
Trend Investing v IEA demand forecast for EV metals (Trend Investing) (IEA)
2021 IEA forecast growth in demand for selected minerals from clean energy technologies by scenario, 2040 relative to 2020 – Increases Of Lithium 13x to 42x, Graphite 8x to 25x, Cobalt 6x to 21x, Nickel 7x to 19x, Manganese 3x to 8x, Rare Earths 3x to 7x, And Copper 2x to 3x
Rio Tinto forecasts lithium emerging supply gap (October 2021) – 60 new mines the size of Jadar will be needed
BMI demand growth 2022-2035 (in mtpa) for critical metals, also number of new mines required by 2035
On November 25 CleanTechnica reported:
BYD may begin sodium-ion battery production in 2023. Reports from China suggest BYD may be the first manufacturer to bring electric cars with sodium-ion batteries to market…Rumors are flying about in China that claim BYD plans to be producing sodium-ion battery cells in the second quarter of 2023 and use them to power some of its own electric vehicles. The company claims those rumors are false…Sodium batteries have one important drawback, however. They have a lower energy density than lithium batteries, so you need more of them to have an equivalent amount of energy available to power an electric car…The lower power density will probably be less of a factor at the lower end of the market where the primary factor in the decision to purchase an electric car is price rather than performance.
On November 28 Construction News UK reported:
Green light for £200m Teesside lithium factory. Tees Valley Lithium (TVL), a subsidiary of Alkemy Capital Investments, was given the green light to develop a lithium hydroxide refinery at the Wilton International Chemical Park at Teesside Freeport. The plant, which will be the largest in Europe when built…and supply lithium for up to 15 per cent of Europe’s electric-vehicle market. The refinery will be capable of producing both lithium hydroxide and lithium carbonate sourced from imported high-grade feedstock from South America and lithium producers located in Australia and elsewhere. Construction of the plant is expected to commence in 2023.
On November 29 Reuters reported:
Indonesia says lithium, anode plants are being built to support EV ambitions. Indonesia is building a lithium refinery and an anode material production facility to complement its nickel-based battery materials industry, an official said, as it aims to set itself up as a hub for making electric vehicles (EVs).
On December 1 Seeking Alpha reported:
ProShares launches an ETF meant to capitalize on the growing demand for batteries…ProShares is looking to capture with the launch of the ProShares S&P Global Core Battery Metals ETF (ION). The fund, which hit the market on Thursday, offers exposure to global stocks involved in the mining of lithium, nickel or cobalt. According to ProShares research, global demand for batteries is anticipated to expand by 25% annually until at least 2030.
On December 5 Market Index reported: “Lithium price support from Chinese production cuts: Macquarie.
On December 6 BloombergNEF reported:
Lithium-ion battery pack prices rise for first time to an average of $151/kWh. Rising raw material and battery component prices and soaring inflation have led to the first ever increase in lithium-ion battery pack prices since BloombergNEF (BNEF) began tracking the market in 2010…For battery electric vehicle (BEV) packs in particular, prices were $138/kWh on a volume-weighted average basis in 2022…Prices could have risen further in 2022 had it not been for the higher adoption of the low-cost cathode chemistry known as LFP… LFP cells were 20% cheaper than lithium nickel manganese cobalt oxide (NMC) cells in 2022.
On December 8 Seeking Alpha reported:
Lithium prices could climb higher, helped by U.S. climate bill, execs say… “Everybody needs lithium,” so pricing will remain strong, Albemarle (NYSE:ALB) executive Eric Norris told Bloomberg at the conference, adding the U.S. climate bill may “reignite our M&A.”…The company is looking at targets in jurisdictions such as Canada and Australia, which have free trade agreements with the U.S., Norris said… Goldman sees the global lithium market in an 84K-ton deficit this year, compared with a prior forecast of an 8K-ton surplus…
On December 8 Finance News Network reported:
Lithium stocks under pressure following Goldman’s comments… Goldman Sachs said it expects lithium prices to fall over the second half of 2023 and into 2024 as the supply and demand outlook rebalances. Goldman Sachs has initiated coverage on several players. The company has a sell recommendation and $1 price target on Core Lithium [ASX:CXO], which has sent the stock down 6 per cent today. Conversely, Goldmans has a Buy rating on Allkem (ASX:AKE), with a $15.20 price target, along with Mineral Resource (ASX:MIN). It has neutral ratings on Pilbara Minerals (ASX:PLS), Independence Group (ASX:IGO) and Liontown (ASX:LTR).
On December 9 Reuters reported:
Exclusive: Canada aims to speed up new projects with critical minerals strategy…The government pledged to review the permitting process with an eye on cutting the time required to bring mines online by avoiding duplication and ensuring early indigenous consultation and engagement, the 58-page strategy document said. It did not say when the review would be completed.
On December 9 the Government of Canada announced:
Minister Wilkinson releases Canada’s $3.8-billion Critical Minerals Strategy to seize generational opportunity for clean, inclusive growth…Today, in Vancouver, the Honourable Jonathan Wilkinson, Canada’s Minister of Natural Resources, released Canada’s Critical Minerals Strategy, backed by up to $3.8 billion in federal funding allocated in Budget 2022. The proposed funding covers a range of industrial activities, from geoscience and exploration to mineral processing, manufacturing and recycling applications, including support for research, development and technological deployment.
On December 13 Reuters reported: “Western countries forge green alliance for getting electric vehicle minerals.”
On December 13 Investing News reported:
“Caspar Rawles: Cathodes, anodes and what to expect in 2023… “Fundamentally, one of the challenges that potentially plays into all of this, is that you can build the battery plants, you can build the EV plants, you can build the cathode plants, but if you don’t have the raw materials to feed them, they’re just expensive weights on your balance sheet,” Rawles said.
On December 14 Forbes reported:
Tesla cofounder aims to rev up U.S. EV battery market with $3.5 billion South Carolina Plant. Redwood Materials, the battery recycling and components maker created and run by Tesla cofounder JB Straubel, is accelerating its push to build a U.S. supply base for critical components for electric vehicle batteries…The Carson City, Nevada-based company, which last month said it would supply lithium-ion cathodes to Panasonic from a $1.1 billion plant under construction in its home state, is acquiring 600 acres in Camp Hall, an industrial park near Charleston, for an East Coast complex that will eventually employ 1,500 people. The “closed-loop” facility will recycle and recover high-value metals from used batteries and turn them into cathode and anode materials needed by new battery plants…
On December 18 Mining.com reported:
Australia expects sharp lithium price pullback in 2024. In its quarterly report released on Monday, the Australian government said it expects spodumene prices to rise from an average of $2,730 a tonne in 2022 (from just $598 in 2021) to average $4,010 a tonne in 2023 as record spot prices feed into contracts. However, 2024 will see a softening in the market to $3,130 in 2024. Lithium hydroxide prices are set to follow a similar pattern and are expected to lift from $17,370 a tonne in 2021 to $39,900 in 2022 and $61,200 in 2023, moderating to an annual average of $48,500 in 2024.
On December 19 Investing News reported:
Lithium market 2022 year-end review…Lithium prices remained at all-time highs in 2022 as electric vehicle (EV) demand jumped and supply tightness increased. The key raw material used in batteries took center stage this past year, and from bearish oversupply calls from banks to lithium stocks seeing gains, it was an eventful 12 month period for the sector…Patki’s demand estimate for 2023 is that the industry will need a million tonnes of lithium carbonate equivalent. “Again, whether there’s supply that will be able to meet that, that’s the big question,” he said… For the business development director at Livent, if supply cannot catch up, demand will be deferred, not destroyed…For lithium miners trying to develop projects and bring supply on stream, financing continues to be a big hurdle… “Funding has happened, but it’s not happening still at a rate that anyone needs. Institutional money is still not as aggressive as it should be,” said Simon Moores of Benchmark Mineral Intelligence. “And then, if they get the money to take it to the permitting stage, then permitting is a massive hurdle — it can add 50 percent of the time onto building your mine.”
On December 21 PRNewswire reported:
CATL’s German plant kicks off cell production. Contemporary Amperex Technology Thuringia GmbH (CATT), CATL’s first plant outside of China, has kicked off serial production of lithium-ion battery cells in December as scheduled, marking another milestone on CATL’s global journey… With a total investment of up to 1.8 billion Euro, CATL plans to achieve a production capacity of 14GWh.
On December 13, Albemarle announced:
Albemarle announces North Carolina Technology Park for advanced lithium technology…where it will invest at least $180 million to establish the Albemarle Technology Park (ATP), a world-class facility designed for novel materials research, advanced process development, and acceleration of next-generation lithium products to market. The company anticipates that innovations from the new site will enhance lithium recovery, improve production methods, and introduce new forms of lithium to enable breakthrough levels of battery performance.
No significant news for the month.
Q4, 2023 – Mt Holland spodumene production to begin (SQM/Wesfarmers JV).
Q4, 2024 – 50ktpa Lithium hydroxide [LiOH] refinery (SQM/Wesfarmers JV).
Investors can read SQM’s latest presentation here or the latest Trend Investing article on SQM here.
No significant news for the month.
Investors can read the latest Trend Investing article on Ganfeng Lithium here.
(Chengdu) Tianqi Lithium Industries Inc. [SHE:002466], Tianqi Lithium Energy Australia (TLEA) is a JV with Tianqi Lithium (51%) and IGO Limited (49%). TLEA owns the Kwinana lithium hydroxide facility in WA
On December 7, Reuters reported:
China’s Tianqi exploring battery minerals processing options in Australia. China’s Tianqi Lithium Corp is exploring investment opportunities in Australia’s burgeoning battery minerals sector through its local tie up with Western Australia-based (WA) miner IGO Ltd, its chief executive said… “WA already export(s) all the minerals needed to make batteries. There is enormous environmental and economic benefit in successfully developing downstream processing capabilities near the source of those resources,” Tianqi CEO Frank Ha said in a statement late on Tuesday.
On December 19, Market Screener reported: “Tianqi Lithium Corporation (SEHK: 9696) added to FTSE All-World Index.”
On December 19, Market Screener reported: “Tianqi Lithium Corporation(SEHK:9696) added to S&P Global BMI Index.”
Kwinana lithium refinery JV (51% Tianqi: 49% IGO) in Western Australia
On November 28, Pilbara Minerals announced:
Pilbara and Calix enter into Joint Venture Agreement for Mid–Stream Demonstration Plant. Parties to jointly develop a “mid-stream” demonstration plant at the Pilgangoora Project…
On December 2, Pilbara Minerals announced: “Index announcement S&P Dow Jones Indices announces December 2022 Quarterly Rebalance of the S&P/ASX Indices.”
On December 14, Pilbara Minerals announced:
Results of BMX auction. Following the auction process the Company has sold two cargoes for a combined total of 10,000dmt at an average price of US$7,552/dmt (SC5.5, FOB Port Hedland basis). The equivalent SC6.0 price negotiated equates to a price inclusive of freight, CIF to China of US$8,299/dmt, with deliveries expected from late January 2023.
On December 21, Pilbara Minerals announced: “Offtake pricing and project expansion update. Customer price reviews achieve improved pricing outcomes; P680 expansion project schedule on track with revised capital cost estimate.” Highlights include:
Mt Marion Mine (50% MIN: 50% Ganfeng). Wodgina Lithium Mine (60% ALB: 40% MIN) restarted in mid 2022. (Note the non-binding agreement will (if completes) move Wodgina to a 50% ALB: 50% MIN JV). The 50ktpa Kemerton Lithium Hydroxide refinery (60% ALB: 40% MIN) is due for first sales in H2, 2022.
No lithium news for the month.
Investors can read the latest Trend Investing article on Mineral Resources here.
MinRes’ production expansion targets as of Nov. 2022 (source) – Includes doubling Mt Marion capacity from 450-900ktpa in early 2023 and Wodgina from 500ktpa to 750ktpa (Train 3 adds 250ktpa) by mid 2023
Mineral Resources 2022 AGM presentation
On November 29, Livent Corp. announced:
Livent and NTU Singapore announce research partnership to accelerate innovation in Sustainable Lithium Battery Technologies…
On December 16, Allkem announced:
Allkem completes acquisition of strategic lithium tenement and the sale of Borax…MSR has sold to an Allkem subsidiary 100% ownership of the Maria Victoria Tenement…Managing Director and CEO Martin Perez de Solay said, “The Maria Victoria tenement is expected to add resource tonnes to the already substantial lithium brine resource defined at Olaroz. Control of this tenement will enable the more efficient development of the Olaroz salar as we consider the long term expansion of production.”… The Maria Victoria Tenement covers approximately 1,800 ha and is located in the northern part of the Salar de Olaroz, approximately 10km from Allkem’s Olaroz Lithium Facility.
Upcoming catalysts include:
You can read the latest investor presentation here. You can read the latest Trend Investing Allkem article here.
On December 22 AMG announced:
AMG Advanced Metallurgical Group N.V. announces tantalum Strategic Partnership with Nippon Mining & Metals Corporation.
You can view the latest company presentation here or the recent Trend Investing article here.
On December 20, Lithium Americas announced:
Lithium Americas to acquire Arena Minerals to consolidate the highly prospective Pastos Grandes Basin…Pursuant to the Arrangement Agreement, Arena’s shareholders (“Arena Shareholders”) will receive 0.0226 (the “Exchange Ratio”) of a Lithium Americas common share (a “LAC Share”) for each Arena Share held (the “Consideration”). The Consideration to Arena implies a total equity transaction value (on a 100% basis) of US$227 million (C$311 million), based on the closing price on December 19, 2022, which would result in Arena Shareholders owning approximately 5.7% of Lithium Americas.
NB: Ganfeng Lithium (51%) and Lithium Americas (49%) own the JV company Minera Exar S.A., which owns 91.5% interest and is entitled to 100% of the production from the Cauchari-Olaroz Project. The 8.5% interest is owned by Jujuy Energia y Mineria Sociedad del Estado (“JEMSE”) (a company owned by the Government of Jujuy province).
Argosy has an interest in the Rincon Lithium Project in Argentina, targeting a fast-track development strategy. Argosy initially plans to ramp to 2,000tpa lithium carbonate starting early 2023.
On December 8 BNAmericas reported:
Argosy Minerals to invest US$200mn in Argentina’s Salar Rincón phase III…Puna Mining, a unit of Australia’s Argosy Minerals, plans to invest US$200mn in phase III of the Salar Rincón project in Argentina’s Salta province to reach production of 12,000t/y of lithium carbonate.
On December 22, Argosy Minerals announced: “Rincon 2,000tpa Li2CO3 operational update. 99.76% lithium carbonate product produced during commissioning operations.” Highlights include:
Investors can view the company’s latest investor presentation here, and the latest Trend Investing Argosy Minerals article here.
Core 100% own the Finniss Lithium Project (Grants Resource) in Northern Territory Australia. Significantly they already have an off-take partner with China’s Yahua (large market cap, large lithium producer), who has signed a supply deal with Tesla (TSLA). The Company states they have a “high potential for additional resources from 500km2 covering 100s of pegmatites.” Fully funded and starting mining with a planned Q4 2022 production start.
On November 11, Core Lithium Ltd. announced: “Australasian Metals establishes research consortium in North Arunta Pegmatite district, Northern Territory.” Highlights include:
On December 16, Core Lithium Ltd. announced: “Finniss Project exploration results.” Highlights include:
Investors can read a company presentation here, or the Trend Investing article when Core Lithium was back at A$0.055 here.
Sigma is developing a world class lithium hard rock deposit with exceptional mineralogy at its Grota do Cirilo Project in Brazil.
On December 4, Sigma Lithium Resources announced:
Sigma Lithium achieves outstanding project expansion and financing milestones: Increases mineral reserves by 63%, triples NPV to US$ 15.3billion and secures US$ 100 million debt financing…
On December 20, Sigma Lithium Resources announced:
Sigma lithium successfully initiates commissioning of Greentech Plant on schedule and within budget…
Investors can read the latest company presentation here or the Trend Investing article here back when Sigma was trading at C$5.00.
Sigma Lithium has very large production plans (source)
On November 24, Sayona Mining announced: “NAL restart picks up speed.” Highlights include:
On December 12, Sayona Mining announced: “Final permit awarded for NAL restart.” Highlights include:
On December 20, Sayona Mining announced:
Morella completes earn-in requirements for Pilbara lithium assets. Morella satisfies both expenditure and activity requirements covering several lithium projects in Western Australia. Joint venture to be formed with partner Sayona Mining Limited with Morella to hold 51% managing stake and Sayona 49%. Work to date has identified three (3) highly prospective targets at the Mallina, Tabba Tabba and Mount Edon projects.
On December 20, Sayona Mining announced: “NAL restart advances towards target.” Highlights include:
Upcoming catalysts include:
Piedmont Lithium (Nasdaq:PLL) [ASX:PLL]
Piedmont Lithium 100% own the Carolina Lithium spodumene project in North Carolina, USA; as well as 25% of the North American Lithium [NAL] Project in Canada and 50% of the Ghana Lithium Project.
On December 12 Piedmont Lithium reported:
North American Lithium receives remaining permit required to restart mining operations…Receipt of the key permit from Canada’s Department of Fisheries and Oceans paves the way for an expected restart of spodumene concentrate production in H1 2023…
Upcoming catalysts include:
You can view the company’s latest presentation here or a Trend Investing article here.
The LIT fund was down heavily in December. The current PE is 19.59.
Our model forecast is for lithium demand to increase 5.3x between end 2020 and end 2025 to ~1.8m tpa, and 13x this decade to reach ~4.5 m tpa by end 2029 (assumes electric car market share of 32% by end 2025 and 70% by end 2029).
Note: A Nov. 2020 UBS forecast is for “lithium demand to lift 11-fold from ~400kt in 2021 through to 2030.”
Global X Lithium & Battery Tech ETF (LIT) 10 year price chart
December saw lithium prices fall slightly and lithium miners very harshly sold off. 2022 has certainly been a wild year.
Go figure!!! We are talking about lithium, a specialty chemical with demand forecast by Trend Investing to increase a staggering 35x between 2020 and 2037 (the IEA forecast is for a 13-42x increase from 2020 to 2040).
Highlights for the month were:
As usual all comments are welcome.
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This article was written by
Disclosure: I/we have a beneficial long position in the shares of GLOBAL X LITHIUM ETF (LIT), AMPLIFY LITHIUM & BATTERY TECHNOLOGY ETF (BATT), ALB, JIANGXI GANFENG LITHIUM [SHE: 2460], ASX:AKE, ASX:PLS, ASX:MIN, LIVENT (LTHM), ADVANCED METALLURGICAL GROUP NV (AMS:AMG), TSX:LAC, ARGOSY MINERALS [ASX:AGY], ASX:LTR, ASX:CXO, ASX:SYA, ASX:PLL, ASX:NMT, ASX:1MC, SIGMA LITHIUM [TSXV:SGMA], VULCAN ENERGY RESOURCES [ASX:VUL], GALAN LITHIUM [ASX:GLN], SAVANNAH RESOURCES [XETRA:SAV], LITHIUM SOUTH DEVELOPMENT CORP. [TSXV:LIS], CRITICAL ELEMENTS LITHIUM [TSXV:CRE], WINSOME RESOURCES [ASX:WR1], INTERNATIONAL LITHIUM [TSXV:ILC], ARENA MINERALS [TSXV:AN], GLOBAL LITHIUM RESOURCES [ASX:GL1], LITHIUM ENERGY LIMITED [ASX:LEL], EUROPEAN METAL HOLDINGS [ASX:EMH], EUROPEAN LITHIUM [ASX:EUR], FRONTIER LITHIUM [TSXV:FL], METALS AUSTRALIA OPTIONS [ASX:MLSOD], GREEN TECHNOLOGY METALS [ASX: GT1], ESSENTIAL METALS [ASX:ESS], AVALON ADVANCED MATERIALS [TSX:AVL], SNOW LAKE LITHIUM (LITM), PATRIOT BATTERY METALS [TSXV:PMET], OCEANA LITHIUM [ASX:OCN], CYGNUS GOLD [ASX:CY5], MINREX RESOURCES [ASX:MRR], LOYAL LITHIUM [ASX:LLI], FREYR BATTERY (FREY) either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.