Our High Voltage column wraps all the news driving ASX stocks with exposure to lithium, cobalt, graphite, nickel and vanadium.

Last week, ASX lithium stocks went mental. The spark was Pilbara Minerals (ASX:PLS)  with its announcement that the first auction of spodumene — a lithium precursor — had gone off at an amazing $US1,250t.

The momentum has carried into the new week, with several explorers mentioned in our ‘Cheapest lithium-facing stocks on the ASX’ yarn making gains on Monday.

But there are other battery metals with huge exposure to the EV thematic. Is there opportunity for graphite, nickel, cobalt, or rare earths stocks to go on a similar run?

Most probably – with sentiment this high, all it would take is a ‘Pilbara Minerals-like’ catalyst.

Let’s look at the current state of play.

 

GRAPHITE

Demand from the steelmaking and battery sectors is skyrocketing, but a graphite price blowout is being held back by one main thing — high freight prices and substantial shipping delays from major producer and exporter China.

“Whilst industrial and battery end-market demand improved in June, persistently high freight prices and substantial delays continued to place a cap on demand for exported material from China,” Benchmark Mineral Intelligence writes.

“International consumers [are] keen to explore alternative sources and shipping routes rather than face shipping costs and logistical challenges FOB China.

“As a result, there was little room for Chinese producers to negotiate higher prices, despite increased demand.”

Market contacts remarked that, in many cases, freight pricing was still rising. This could begin to impact African graphite sources, which to date have been somewhat sheltered from the highest prices.

There is good news because, regardless of these issues, batteries still need graphite.

Market sources told Benchmark of “improving international market activity as consumers and traders alike have been forced to re-stock inventory regardless of high costs [emphasis ours] after an extended period of disruption”.

 

COBALT

As the EV sector ramps up in the coming years Benchmark is forecasting the cobalt market to move into structural deficit.

Prices are already responding.

Cobalt prices since Jan 2017. Source: Benchmark.

Cobalt hydroxide and cobalt sulphate prices recorded gains of 15.6% and 10.6% respectively in July.

Moving into the second half of the year, the outlook for both battery and industrial demand is set to increase on improving macroeconomic conditions and surging EV sales globally, Benchmark says.

 

RARE EARTHS

Rare earths are also running hot. In the June quarter Lynas (ASX:LYC) – the only scale producer of separated rare earths outside China – raked in record sales revenue of $185.9m.

This reflected strong market pricing as end users and governments around the world “continue to recognise the need for a diversified supply of responsible rare earth materials” outside China.

“Despite the global shortage of semi-conductors which affects all industries and in particular, the automotive industry, the NdFeB market is experiencing very strong growth, supporting the demand for NdPr and the HRE produced by Lynas,” the company said.

“At the same time, the demand for catalyst from the automotive and the FCC sectors is back to its pre-COVID levels.

“While prices experienced some decrease through the quarter, we perceive this as a normal correction after the sharp and speculative increases seen in the previous months.

“Prices strengthened again in July.”

 

NICKEL

In March, Chinese nickel giant Tsingshan announced plans to supply 100,000 tonnes of nickel ‘matte’ converted from lower quality nickel pig iron (NPI) to battery midstream majors CNGR and Huayou Cobalt.

News that Tsingshan was about to supply a big chunk of the current and predicted battery nickel shortfall with converted ‘class 2’ nickel — largely avoided due to higher conversion costs and an elevated carbon footprint – was enough to send shockwaves through the red-hot nickel market.

Should nickel investors be worried? Probs not.

Nickel prices over the past year. Source: LME

Nickel demand from the lithium-ion battery industry continued to surge in July, as leading automakers boosted mid-to-long term EV commitments.

The most notable example was Tesla’s long-term supply agreement for class 1 nickel with BHP.

This is the first public deal of its kind for a major Western automaker.

“For Tesla, the BHP deal adds to two more nickel supply deals that Tesla has likely secured from 2022 onwards, with Prony Resources and Vale,” Benchmark says.

“Across these three deals, Benchmark estimates Tesla could have secured 55,000tpa of nickel, enough to produce up to 1.25m standard range Model 3 vehicles annually using high nickel NCM technology.

“While concerns over tight nickel supply for the battery industry were seemingly eased in March 2021 — following the announcement Tsingshan would convert some of its nickel pig iron (NPI) output to nickel matte, Tesla’s latest agreement with BHP speaks to Western automakers’ concerns over the ESG credentials of Indonesian nickel.”

The market remains super tight, Benchmark says.

“Industry contacts reported persistent tightness in nickel sulphate supply, amidst burgeoning demand from the battery industry and limited raw material availability, with demand for nickel briquettes remaining particularly robust owing to the continued difficulty in procuring MHP and other intermediates,” it says.

 

VANADIUM

Vanadium demand is making a comeback as steel consumption soars, in China and overseas.

92% of vanadium consumption is used to strengthen steel. Of the remainder, most is used in aerospace alloys and chemical catalysts, and 1% goes into vanadium redox flow batteries (VRFBs).

Roskill’s base case is that by 2030, 10% of vanadium demand is going to come from batteries.

The market is going to shift into deficit in 2021, Roskill’s steel alloys principal consultant Erik Sardain says.

“Moving forward in the next couple of years, supply is likely to remain tight in 2022 and 2023 until new projects come online from 2024,” he says.

 

Here’s how a basket of ASX stocks with exposure to lithium, cobalt, graphite, nickel, and vanadium are performing>>>

Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop:

CODE COMPANY 1 WEEK RETURN % 1 MONTH RETURN % 6 MONTH RETURN % 1 YEAR RETURN % SHARE PRICE [INTRADAY MON] MARKET CAP
WKT Walkabout Resources 9 -6 60 37 0.24 $ 97,843,547.21
VRC Volt Resources 4 -17 81 61 0.029 $ 61,001,289.63
BOA Boadicea Resources 2 0 -11 32 0.23 $ 17,093,976.90
GXY Galaxy Resources 5 30 83 284 4.88 $ 2,447,440,999.52
GLN Galan Lithium 22 35 148 743 1.265 $ 321,346,481.98
ARN Aldoro Resources 10 23 98 312 0.515 $ 38,454,755.03
FFX Firefinch 6 8 118 183 0.425 $ 391,416,472.38
SGQ St George Min 0 -3 -32 -29 0.068 $ 40,064,983.72
VUL Vulcan Energy 29 61 40 2227 12.68 $ 1,441,058,247.25
ORE Orocobre Limited 4 31 77 161 8.55 $ 2,920,136,522.56
STK Strickland Metals -16 -9 41 11 0.041 $ 45,384,487.93
MNS Magnis Energy Tech 50 47 23 103 0.405 $ 361,230,336.59
PLS Pilbara Min 19 42 113 443 2.1 $ 6,064,097,714.40
PRL Province Resources 11 -9 650 372 0.15 $ 163,256,922.60
QPM Queensland Pacific 15 27 192 850 0.19 $ 262,004,560.55
GAL Galileo Mining 13 31 -8 -1 0.34 $ 48,654,409.70
MAN Mandrake Res -7 -43 -1 116 0.082 $ 35,114,377.51
FGR First Graphene -16 -21 -27 78 0.205 $ 115,142,957.79
LIT Lithium Australia NL 15 20 -12 107 0.1325 $ 129,858,762.20
ADD Adavale Resource 17 -14 11 360 0.069 $ 19,790,165.66
COB Cobalt Blue -10 -7 -16 145 0.27 $ 76,831,117.16
NMT Neometals 13 35 119 314 0.745 $ 394,831,005.12
BKT Black Rock Mining 3 0 7 198 0.155 $ 131,699,232.23
CLA Celsius Resource -13 -22 -48 33 0.028 $ 29,322,386.27
MIN Mineral Resources -7 4 68 108 58.88 $ 11,125,986,138.90
S2R S2 Resources -15 4 -24 4 0.14 $ 50,382,588.64
EUR European Lithium 15 17 1 51 0.068 $ 63,507,621.07
TKL Traka Resources -7 -19 -38 -55 0.013 $ 7,512,617.31
MLX Metals X Limited -11 11 44 195 0.245 $ 231,352,847.09
GBR Greatbould Resources 6 9 126 95 0.093 $ 34,461,290.88
AQD Ausquest Limited -9 -17 0 -26 0.02 $ 16,463,796.62
SYA Sayona Mining 28 7 164 981 0.105 $ 585,859,022.39
GME GME Resources 0 4 -33 30 0.052 $ 29,513,947.29
CXO Core Lithium 31 53 14 700 0.36 $ 422,682,211.44
CWX Carawine Resources -6 -2 5 10 0.225 $ 24,500,227.95
IGO IGO Limited 2 17 50 93 9.53 $ 7,390,933,854.88
MCR Mincor Resources NL 1 22 16 60 1.245 $ 544,782,537.18
ARU Arafura Resource 2 6 -42 61 0.1275 $ 175,031,724.01
NTU Northern Min 5 24 -16 64 0.041 $ 193,668,518.64
OZL OZ Minerals -4 0 19 58 22.35 $ 7,465,197,892.56
ARL Ardea Resources 6 -4 19 -9 0.53 $ 73,158,136.07
BHP BHP Group Limited -3 6 19 30 51.95 $ 153,478,857,627.40
LKE Lake Resources 32 66 105 1608 0.615 $ 709,023,035.82
DEV Devex Resources -15 -27 4 21 0.235 $ 76,958,491.75
BUX Buxton Resources -19 -16 48 38 0.105 $ 14,285,820.36
LYC Lynas Rare Earths 4 35 55 211 7.61 $ 6,830,175,628.82
AXE Archer Materials -4 39 71 265 1.44 $ 347,252,482.65
BAR Barra Resources -5 0 -21 -21 0.019 $ 13,213,357.97
ESS Essential Metals 11 41 7 60 0.155 $ 34,138,941.00
LML Lincoln Minerals 0 0 0 14 0.008 $ 4,599,869.49
AJM Altura Mining 0 0 0 0 0.07 $ 209,037,029.25
ATM Aneka Tambang 0 0 0 0 1 $ 1,303,649.00
GED Golden Deeps -15 -15 -15 -8 0.011 $ 9,310,217.28
ADV Ardiden 63 63 -46 0 0.013 $ 23,642,896.38
HWK Hawkstone Mng 32 12 -12 106 0.037 $ 58,203,340.13
RFR Rafaella Resources 2 4 -1 43 0.097 $ 17,012,399.38
INF Infinity Lithium 3 -13 -57 16 0.0955 $ 40,291,455.60
QXR Qx Resources Limited 0 -19 -28 -24 0.013 $ 8,662,710.17
AUZ Australian Mines -10 -17 -22 -3 0.019 $ 86,071,182.28
RXL Rox Resources -2 -12 -24 -56 0.41 $ 66,195,197.88
PAM Pan Asia Metals 32 37 -3 0.185 $ 9,121,969.48
SYR Syrah Resources 7 48 35 267 1.505 $ 762,263,553.69
BSX Blackstone -12 7 -25 0 0.38 $ 131,073,715.05
TMT Technology Metals 4 16 7 115 0.365 $ 51,811,429.67
SRI Sipa Resources 5 7 -9 -39 0.058 $ 10,771,335.78
AGY Argosy Minerals 21 26 -9 184 0.145 $ 181,289,397.08
LPI Lithium Pwr Int 17 47 9 62 0.315 $ 97,850,200.18
CHN Chalice Mining -7 -14 66 520 6.79 $ 2,449,390,969.20
LEG Legend Mining 6 -11 -19 -38 0.093 $ 256,227,622.05
HXG Hexagon Energy 1 -15 -40 5 0.069 $ 31,220,967.89
TNG TNG Limited 3 12 -26 3 0.074 $ 89,963,786.88
EGR Ecograf Limited 28 56 32 1286 0.915 $ 427,341,786.05
MOH Moho Resources 0 -11 -14 -53 0.068 $ 6,919,451.93
ASN Anson Resources 25 31 -2 345 0.089 $ 82,271,703.06
HAS Hastings Tech Met 8 19 -4 79 0.215 $ 356,383,329.53
AVZ AVZ Minerals 16 43 16 231 0.215 $ 707,631,322.86
INR Ioneer 15 25 16 276 0.47 $ 894,972,543.47
PNN PepinNini Minerals 17 19 -30 97 0.35 $ 16,810,752.75
BEM Blackearth Minerals 29 29 52 207 0.135 $ 27,944,101.51
CNJ Conico 28 181 97 462 0.073 $ 63,229,325.83
AZS Azure Minerals -2 -6 -51 44 0.245 $ 75,762,751.65
AVL Aust Vanadium 8 24 4 136 0.026 $ 70,347,811.54
LPD Lepidico 40 62 -25 200 0.021 $ 141,497,896.26
CTM Centaurus Metals 2 17 11 82 0.945 $ 326,542,599.40
LTR Liontown Resources -1 12 129 632 0.915 $ 1,779,225,749.40
POS Poseidon Nick -22 14 40 133 0.105 $ 309,035,633.72
VMC Venus Metals Cor 0 -10 -23 -29 0.18 $ 26,438,769.53
JRV Jervois Mining -5 -14 1 98 0.46 $ 516,093,112.83
NIC Nickel Mines Limited -2 4 -13 77 1.0775 $ 2,753,956,810.85
AOU Auroch Minerals -6 14 -28 168 0.1875 $ 53,721,258.49
REE Rarex Limited -1 32 -21 55 0.099 $ 43,534,320.40
VML Vital Metals Limited 27 15 41 417 0.062 $ 240,945,518.87
ARR American Rare Earths 41 43 21 380 0.12 $ 36,152,374.23
EMH European Metals Hldg -5 3 38 472 1.66 $ 208,147,144.00
PSC Prospect Res 11 39 97 154 0.355 $ 139,986,090.28
RLC Reedy Lagoon Corp. 25 18 11 100 0.02 $ 8,460,470.99
AML Aeon Metals . 0 -21 -50 -61 0.057 $ 44,299,044.25
G88 Golden Mile Res 4 -5 17 -16 0.054 $ 7,701,008.04
JRL Jindalee Resources 28 29 61 825 3.14 $ 166,620,373.92
PGM Platina Resources 1 -5 53 56 0.081 $ 37,791,263.75
PAN Panoramic Resources -3 13 9 140 0.175 $ 348,655,380.68
TLG Talga Group -1 3 -8 154 1.335 $ 409,360,373.10
IXR Ionic Rare Earths 0 -6 -17 186 0.03 $ 94,987,186.39
VR8 Vanadium Resources 4 -13 38 116 0.054 $ 20,922,205.25
PLL Piedmont Lithium Inc 7 -23 19 735 0.785 $ 454,131,974.00
ESR Estrella Res -11 -15 -51 225 0.039 $ 45,319,705.86
GW1 Greenwing Resources 4 11 -17 67 0.25 $ 21,003,548.94
ALY Alchemy Resource 7 0 -17 -19 0.015 $ 10,083,651.80
HNR Hannans 14 14 0 14 0.008 $ 16,519,840.34
TON Triton Min 3 -6 -43 -39 0.033 $ 37,437,446.21
IPT Impact Minerals -13 -7 -35 -38 0.013 $ 27,321,231.41
SLZ Sultan Resources -3 -10 -10 3 0.18 $ 12,516,190.02
RNU Renascor Res 34 43 168 519 0.099 $ 172,841,471.98
PUR Pursuit Minerals 0 -12 88 258 0.06 $ 56,547,848.88
SBR Sabre Resources 0 -11 -43 33 0.004 $ 6,732,254.60
SRL Sunrise 6 18 -22 34 2.095 $ 190,280,979.09
MLS Metals Australia 33 0 0 -33 0.002 $ 8,454,376.09
CZN Corazon -7 2 -30 5 0.042 $ 8,325,219.90
MRC Mineral Commodities -6 -21 -63 -39 0.145 $ 78,248,795.70
GL1 Globallith 13 15 0.315 $ 26,247,889.32
NKL Nickelx 3 11 0.195 $ 10,165,000.00
PEK Peak Resources -20 -8 -16 163 0.092 $ 149,892,160.67
NWC New World Resources -5 -13 55 153 0.076 $ 115,772,231.73
BMM Balkanminingandmin 50 0.63 $ 19,825,000.00
BRB Breaker Res NL -3 -6 -24 -42 0.155 $ 52,134,548.64
ARN Aldoro Resources 10 23 98 312 0.515 $ 38,454,755.03
NMT Neometals 13 35 119 314 0.745 $ 394,831,005.12
IGO IGO Limited 2 17 50 93 9.53 $ 7,390,933,854.88
CHR Charger Metals 139 0.55 $ 13,760,000.43
AAJ Aruma Resources 24 6 -24 -18 0.068 $ 6,251,694.69
PAM Pan Asia Metals 32.1429 37.037 -2.6316 0.185 $ 9,121,969.48