The lithium shortage is already here
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Many lithium producers are now sold out of excess inventory until the end of 2021, as appetite downstream from the battery industry continues to surge.
“Exceptional demand” from consumers to increase contracted lithium chemical volumes from suppliers remaining unfulfilled, market sources told Benchmark.
“Market participants reported to Benchmark that certain South American lithium producers had begun to renegotiate or cancel volume commitments to some customers, having overcommitted to contracts,” Benchmark says.
Lithium feedstock and chemical producers are accelerating expansions as a result of higher prices and improved earnings.
In China, Ganfeng looked to broaden its asset base, announcing plans to purchase the remaining stake in Bacanora Lithium.
Chengxin Lithium, formerly known as Weihua, announced plans to sell off its rare-earths business to accelerate the construction of its lithium hydroxide conversion line.
Elsewhere, SQM brought forward one of its targeted expansion dates by a year.
In WA, Pilbara Minerals (ASX:PLS) inked a deal with tech provider Calix to develop a midstream spodumene refinery.
“From a wider perspective however, local reporting and market sources have indicated to Benchmark that the resurgence of activity in the lithium and broader commodity sector in Western Australia, could begin to create a labour and equipment shortage in the region, and possibly delay project timelines,” Benchmark says.
“Whilst not yet documented, delays to capacity expansions will be followed closely by Benchmark.”
The US mine developer fell in early trade after officials said they would propose listing the Tiehm’s buckwheat flower, endemic to the ‘Rhyolite Ridge’ project site, as an endangered species.
A decision on whether or not to propose a listing will be made by officials in September, at which time a period of public comment would commence if required, ioneer says.
“It’s important to note the 12-month finding, which comprises research up until April 2021, is influenced by potential impacts to the plant from climatic events, recent herbivory and mining activity, but does not consider conservation measures to minimize and mitigate for those impacts, which are still being developed,” managing director Bernard Rowe says.
“We have carried out significant work on propagation and transplantation of the species and remain confident the plant and the mine can successfully coexist.”
Magnis says its 63% owned battery maker Imperium3 New York (iM3NY) produced first full-sized prismatic cells ahead of schedule for limited testing and customer sampling in Q3 2021.
“Today’s achievement has been produced with long hours by a committed team that continues to expand,” iM3NY chief exec Chaitanya Sharma says.
“We will keep working around the clock to achieve our production milestones.”
iM3NY, which raised $US85m in May, has estimated minimum offtake sales of $US655m.
The Argentina-based lithium project developer is advancing project funding discussions with “preliminary interest indicated by over half a dozen major international banks”.
The positive funding environment follows an increased focus by EV makers on supply chain sustainability, mandated by European Union regulations, and a requirement for high quality, battery-grade product, Lake says.
The company uses an innovative direct-extraction technique at its flagship ‘Kachi’ project – amongst the top 10 global lithium brine resources worldwide — to produce cheap, high quality, environmentally friendly lithium.
With $24 million in bank at end March, Lake is well-funded through to final investment decision (FID) on construction finance, anticipated mid-2022.
Fellow Argentina-based brines play Argosy is building a small $US20m, 2000tpa lithium carbonate processing plant at ‘Rincon’.
With 24% of construction works now complete, the company remains on track to achieve first commercial production mid-next year.
Offtake discussions are advanced, it says.
“We are excited as we continue our works to transform Argosy into a battery quality lithium carbonate producer and cashflow generator, and to further progress the 10,000tpa project development expansion,” managing director Jerko Zuvela says.