High Voltage: All the news driving battery metals stocks
Mining & Resources
Anchorman 2/ Paramount Pictures
Each week our High Voltage column wraps all the news driving ASX battery metals stocks with exposure to lithium, cobalt, graphite, manganese and vanadium.
Scroll down for a table showing the recent performance of 200 ASX battery metal stocks >>
Will the Democratic Republic of Congo’s surprising presidential election results – already marred by controversy — have an impact on the international cobalt market?
It’s probably too soon to say (there are already calls for a vote recount) but the world’s biggest cobalt supplier will be watched very closely by miners, battery metals analysts, and customers over the next few months.
Vanadium prices have stabilised over the past week “and the roller coaster may have hit level ground” David Gillam, boss of specialty consultancy Mastermines told Stockhead.
The China spot price is currently holding firm around $US16.72/lb for 98 per cent V205 flake.
And it appears that the introduction of changes to rebar standards were not the main factor behind the huge vanadium price gains in November, Mr Gillam says.
“The evidence shows that compliance has been slow and should be implemented slowly throughout the course of 2019,” he says.
“The recent rapid rise in pricing now appears more likely to have been stocking up prior to winter.
“There may have also been some level of panic as the effect of rebar changes was unknown until now.”
But for those fantasising about a return to those heady $US38/lb days — check yourself.
It’s important to recognise that high prices are not a good thing for the industry, Mr Gillam says.
“We reiterate that V205 selling between $US10 to $US20/lb offers the best long-term benefits for vanadium,” he said.
“Pricing of over $US20/lb may well be damaging to vanadium as steel and alloy markets will consider possible alternatives.
“Equally, implementation of new flow batteries is likely to be seriously affected at over $US15/lb, and certainly at over $US20/lb.”
And some are already tipping a happier year for lithium stocks.
Equity analysts at investment bank Citi are amongst them, saying last week that lithium prices are finally showing signs of stability after dropping by about 55 per cent (for lithium carbonate) during the first three quarters of 2018.
Oliver Heathman, mining research manager at UK-based consultancy Roskill, is also forecasting higher prices.
Roskill’s base case forecast has lithium demand growing around 20 per cent on average over the next decade, and beyond, he said.
“What that means is that by the mid-2020s we will be needing to add the equivalent of the entire 2015 mine production in a single year just to keep up with growing demand,” Heathman said.
SMALL CAP SPOTLIGHT
Of the companies on our list, about 50 lost ground, 67 were ahead and 71 were steady.
This week’s biggest mover was vanadium hopeful Pursuit Minerals (ASX:PUR), which recovered some of its 2018 share price losses to be up almost 90 per cent to 5.4c.
The explorer’s share price jumped 11.5 per cent in morning trade last Wednesday after returning some of the world’s highest-grade vanadium in magnetite concentrates from the Koitelainen Vosa prospect in northern Finland.
And it didn’t hurt that Pursuit management had personally invested $270,000 in the company a few days earlier — which may have given the market confidence that the explorer was on a good wicket.
Other standout performers included graphite explorer Peninsula Mines (ASX:PSM), vanadium focussed Surefire Resources (ASX:SRN), and nickel/ cobalt player Jervois Mining (ASX:JRV).
Here’s a table of ASX battery metal stocks with exposure to lithium, cobalt, graphite, manganese and vanadium>>>
Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop