High Voltage: Lithium miners dominate reporting season, large stockpile of DRC cobalt spells danger for metal prices
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Our High Voltage column wraps all the news driving ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths, manganese, magnesium, and vanadium.
Pilbara Minerals (ASX:PLS) announced its maiden dividend — a payout of 11c a share or $329.8m — after posting a more than 900% rise in net profit after tax to $1.24 billion.
Allkem’s group revenue for the half year increased almost 3x to US$558m ($830m) on the previous corresponding period.
“Excellent operating performance and highly supportive market conditions” generated consolidated net profit after tax of US$219m ($330m).
AKE has existing net cash balance of US$552m ($820m) to fully fund committed projects, it says.
A brawl between Chinese mining giant CMOC and its Congolese state-owned partner over royalty payments means its exports from the country have been blocked since mid-July.
Meanwhile, its tier 1 Tenke Fungurume mine has kept running at close to full clip, “simply stockpiling the extra metal until it can resume shipments”, people familiar with the matter told Bloomberg.
The 250,000tpa copper, 20,000tpa cobalt mine is the #2 biggest copper producer in the DRC.
Bloomberg estimates an ever-growing stash of ~120,000 tons of copper and ~12,500 tons of cobalt is stuck waiting to leave the country.
That’s about 7% of total global monthly copper production, “and is unlikely to affect international prices when it does hit the market”.
But for cobalt, 12,500t represents ~7% of total global annual production. If the stockpile is dumped on the market it could further weaken already soft prices for the battery metal.
The cobalt metal price has continued its bearish run in 2023, driven by soft demand and negative sentiment as major raw material producers, such as CMOC, announce sizeable ramp ups at their assets.
Here’s how a basket of ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths, magnesium, manganese, and vanadium is performing>>>
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