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High Voltage: Lithium prices continue to rocket higher. What happens in 2022?
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Our High Voltage column wraps all the news driving ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths, and vanadium.
Chinese lithium carbonate prices soared in 2021 on the back of a rise in demand for lithium iron phosphate (LFP) batteries in the country.
Transacted prices in China started to breach the RMB 200,000/tonne mark in November, marking a historical milestone for lithium pricing and setting a precedent for expectations of global lithium prices going into 2022.
Battery grade lithium carbonate ended the year at an average price of RMB 250,000/tonne ($39,250) – well above any previous records, Benchmark Mineral Intelligence says.
Global #EV sales of 721,456 in Nov 2021. Total for the YTD 5.57M. Total for 2021 tracking 6.3-6.5M. #RKEquity is forecasting a #lithium shortage of 31-50KT LCE based on 8.1M EV sales in 2022. If that’s conservative then the shortage will be higher. What will #lithium prices do? pic.twitter.com/SGUGeV3neF
— Rodney Hooper (@RodneyHooper13) January 3, 2022
Analysts such as RK Equity partner Rodney Hooper expect demand for battery metals in 2022 will only intensify as the world moves towards clean energy and decarbonisation.
Despite the rise of LFP batteries — which dont use nickel or cobalt — Benchmark Mineral Intelligence said “nickel prices hit a seven year high in 2021 along with a stronger-than-expected recovery in stainless-steel production and robust growth in the battery sector pushed the market into a deficit.”
Cobalt prices are also back in, according to the London-based forecasting agency, following a three-year high during the year – as are graphite with prices beginning to reflect the growth in demand for battery anodes.
Battery metals winners and losers
Here’s how a basket of ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths and vanadium are performing>>>
| CODE | COMPANY | PRICE | 1 WEEK RETURN % | 1 MONTH RETURN % | 6 MONTH RETURN % | 1 YEAR RETURN % | MARKET CAP |
|---|---|---|---|---|---|---|---|
| 1MC | Morella Corporation | 0.019 | 73% | -70% | -70% | -70% | $92,415,851.75 |
| NMT | Neometals Ltd | 1.63 | 49% | 39% | 237% | 524% | $781,436,364.30 |
| RNU | Renascor Res Ltd | 0.1775 | 48% | 61% | 150% | 1514% | $283,395,524.85 |
| ASN | Anson Resources Ltd | 0.1425 | 30% | 24% | 110% | 391% | $137,888,902.80 |
| MNS | Magnis Energy Tech | 0.58 | 27% | 25% | 107% | 190% | $562,669,927.13 |
| AVZ | AVZ Minerals Ltd | 0.87 | 23% | 41% | 427% | 412% | $2,667,257,887.00 |
| RLC | Reedy Lagoon Corp. | 0.038 | 23% | 12% | 138% | 171% | $18,623,745.82 |
| FFX | Firefinch Ltd | 0.915 | 22% | 13% | 132% | 408% | $1,019,087,813.00 |
| WKT | Walkabout Resources | 0.25 | 22% | 32% | 16% | 100% | $96,415,271.33 |
| AGY | Argosy Minerals Ltd | 0.335 | 22% | 34% | 219% | 319% | $405,289,768.64 |
| COB | Cobalt Blue Ltd | 0.505 | 22% | 35% | 68% | 181% | $149,236,430.81 |
| EUR | European Lithium Ltd | 0.1375 | 20% | 20% | 150% | 206% | $143,882,158.81 |
| ESS | Essential Metals Ltd | 0.215 | 19% | 26% | 105% | 162% | $47,101,441.92 |
| LPI | Lithium Pwr Int Ltd | 0.485 | 17% | 7% | 131% | 120% | $160,434,130.08 |
| CXO | Core Lithium | 0.63 | 17% | 20% | 157% | 334% | $987,037,460.32 |
| PLS | Pilbara Min Ltd | 3.44 | 16% | 40% | 136% | 295% | $9,525,748,854.40 |
| MRC | Mineral Commodities | 0.115 | 16% | 19% | -43% | -69% | $58,848,969.74 |
| LKE | Lake Resources | 1.09 | 15% | 36% | 216% | 1393% | $1,233,719,408.65 |
| INF | Infinity Lithium | 0.19 | 15% | 12% | 65% | 23% | $76,606,549.36 |
| AVL | Aust Vanadium Ltd | 0.032 | 14% | 10% | 68% | 129% | $95,160,864.07 |
| QXR | Qx Resources Limited | 0.024 | 14% | 14% | 50% | 71% | $14,923,971.06 |
| SYA | Sayona Mining Ltd | 0.1425 | 14% | 10% | 72% | 1533% | $916,747,848.25 |
| VR8 | Vanadium Resources | 0.074 | 14% | 19% | 14% | 139% | $35,483,428.05 |
| BKT | Black Rock Mining | 0.25 | 14% | 39% | 67% | 160% | $208,474,934.40 |
| LTR | Liontown Resources | 1.735 | 13% | 11% | 120% | 475% | $3,626,113,387.30 |
| GW1 | Greenwing Resources | 0.455 | 12% | -6% | 82% | 160% | $50,910,019.85 |
| AKE | Allkem Limited | 11.04 | 12% | 20% | 67% | 147% | $6,630,266,094.40 |
| TLG | Talga Group Ltd | 1.725 | 12% | 19% | 30% | 6% | $496,668,365.97 |
| INR | Ioneer Ltd | 0.8325 | 12% | 31% | 138% | 197% | $1,640,438,719.20 |
| VRC | Volt Resources Ltd | 0.029 | 12% | 7% | -17% | 190% | $74,935,760.34 |
| AUZDA | Australian Mines Ltd | 0.2 | 11% | -5% | -13% | 28% | $88,222,961.76 |
| LPD | Lepidico Ltd | 0.04 | 11% | -2% | 233% | 300% | $236,405,169.50 |
| CLA | Celsius Resource Ltd | 0.021 | 11% | -13% | -38% | -54% | $21,079,561.62 |
| JRL | Jindalee Resources | 2.23 | 9% | -1% | -10% | 181% | $119,028,725.20 |
| ADV | Ardiden Ltd | 0.012 | 9% | 4% | 50% | -33% | $23,851,688.92 |
| TON | Triton Min Ltd | 0.037 | 9% | -5% | 6% | -27% | $44,739,387.11 |
| BEM | Blackearth Minerals | 0.125 | 9% | 14% | 25% | 178% | $26,117,432.04 |
| CNJ | Conico Ltd | 0.038 | 9% | 0% | 31% | 31% | $36,007,735.46 |
| TNG | TNG Limited | 0.084 | 8% | 8% | 35% | -7% | $111,073,457.76 |
| PSC | Prospect Res Ltd | 0.81 | 7% | 17% | 224% | 376% | $340,676,210.33 |
| MIN | Mineral Resources. | 58.98 | 7% | 32% | 6% | 57% | $10,575,611,816.00 |
| EGR | Ecograf Limited | 0.715 | 7% | 4% | 12% | 321% | $303,975,084.83 |
| QPM | Queensland Pacific | 0.18 | 6% | 0% | 13% | 445% | $254,613,666.62 |
| VUL | Vulcan Energy | 10.95 | 6% | 10% | 37% | 297% | $1,368,719,019.20 |
| AXE | Archer Materials | 1.2 | 6% | 5% | 18% | 133% | $278,513,107.88 |
| AML | Aeon Metals Ltd. | 0.04 | 5% | 0% | -47% | -62% | $33,766,546.63 |
| LIT | Lithium Australia NL | 0.12 | 4% | 9% | 9% | 82% | $118,285,953.19 |
| JRV | Jervois Global Ltd | 0.5975 | 4% | 11% | 10% | 68% | $895,505,458.58 |
| PUR | Pursuit Minerals | 0.027 | 4% | -7% | -62% | 29% | $25,529,828.24 |
| EMH | European Metals Hldg | 1.38 | 3% | 1% | -14% | 20% | $167,818,634.85 |
| CZN | Corazon Ltd | 0.038 | 3% | 9% | -7% | -5% | $11,602,067.55 |
| PLL | Piedmont Lithium Inc | 0.76 | 3% | -5% | -28% | 108% | $405,674,871.00 |
| FGR | First Graphene Ltd | 0.21 | 2% | -7% | -24% | -16% | $115,567,407.06 |
| SRL | Sunrise | 1.815 | 1% | 1% | 0% | -21% | $160,753,314.02 |
| ARR | American Rare Earths | 0.165 | 0% | 6% | 90% | 88% | $64,410,407.16 |
| LML | Lincoln Minerals | 0.008 | 0% | 0% | 0% | 0% | $4,599,869.49 |
| TKL | Traka Resources | 0.013 | 0% | 0% | -24% | -38% | $8,087,402.62 |
| GLN | Galan Lithium Ltd | 1.91 | -1% | 27% | 109% | 396% | $574,265,540.67 |
| PRL | Province Resources | 0.1475 | -2% | -2% | 2% | 1035% | $163,800,672.60 |
| TMT | Technology Metals | 0.295 | -3% | -8% | -12% | -9% | $59,061,803.10 |
| GSR | Greenstone Resources | 0.027 | -4% | -4% | 42% | 4% | $20,984,045.91 |
| GED | Golden Deeps | 0.0115 | -4% | -12% | -23% | 15% | $9,310,217.28 |
| ARL | Ardea Resources Ltd | 0.465 | -5% | -11% | -9% | 25% | $63,861,900.74 |
| GME | GME Resources Ltd | 0.058 | -17% | 2% | 12% | 16% | $38,609,399.53 |
| MLS | Metals Australia | 0.0015 | -25% | -25% | 0% | -25% | $10,477,114.72 |
| GXY | Galaxy Resources | 0 | -100% | -100% | -100% | -100% | $2,715,139,305.12 |
Weekly standouts
Big gainers this week on no news include NMT, whose battery recycling arm – Primobius — signed a deal to licence its recycling tech into North America with leading Canadian steelmaker Stelco (TSX:STLC) at the end of December, 2021.
Stelco plans to secure large volumes of end-of-life EVs for scrap steel and recycled lithium-ion batteries in a proposed 50 tonnes per day integrated operation. Primobius will get a gross revenue royalty.
Neometals was one of 2021’s best performing resource stocks and continues to progress its work streams in Portugal on a lithium refinery, its Barrambie titanium-vanadium Project in Western Australia, and at a vanadium recovery project in Scandinavia.
ARGOSY MINERALS (ASX:AGY) +22%
Argosy is continuing to progress work at its Rincon Lithium Project in the Salta Province of Argentina.
In a market announcement today, the company announced that around 53% of activities have now been completed for the development of the modular 2,000tpa lithium carbonate production operation.
AGY says it remains on schedule to achieve first production of 99.5% battery quality lithium carbonate product from mid-2022.
ASX-listed gold miner and lithium developer Firefinch revealed that a final investment decision had been approved for the Goulamina Lithium Project in Mali, West Africa with project partners Jiangxi Ganfeng Lithium (Ganfeng).
Goulamina is expected to produce 506,000t of spodumene per annum initially before ramping up to a peak of 880,000t, which is expected about 18 months after the commissioning of the first stage.
Funding for stage 2 will be disclosed once the JV is online.
Drilling is currently underway to convert much of the current inferred resource of 43.7Mt grading 1.53% lithium oxide to ore reserves.
Early-stage engineering works, sterilisation drilling and site-based activities are underway.
FFX released an updated definitive feasibility study in early December, which highlighted estimated returns had more than doubled those previously recorded.
Following the DFS update, the capital cost for the 2.3 million tonnes per annum operation (Stage 1) increased from US$194 million to US$255 million.
Goulamina is also set to generate pre-tax net present value (NPV) of $4.1bn and post-tax internal rate of return (IRR) of 83%. Both NPV and IRR are measures of a project’s profitability.
