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Data Projects Skyrocketing Lithium Prices are Due to a Surge in EV Production FinancialBuzz.com News Commentary

Data Projects Skyrocketing Lithium Prices are Due to a Surge in EV Production FinancialBuzz.com News Commentary


According to data compiled by Zion Market Research, the global lithium-ion battery market was valued at approximately USD 31.17 Billion in 2016. The market is expected to generate revenue of USD 67.70 Billion by end of 2022 while growing at a CAGR of 13.7% between 2017 and 2022. The batteries are highly attractive due to their small compact size and their ability to deliver high energy density, which makes lithium-ion batteries popular in the consumer electronics sector and for electric vehicles (EVs). Currently, consumer electronic products such as laptops, phones and tablets control the lithium-ion battery market revenue, but the market is beginning to shift to electric vehicles as demand in the automotive industry grows. MGX Minerals Inc. (OTC: MGXMF), Albemarle Corporation (NYSE: ALB), FMC Corporation (NYSE: FMC), Panasonic Corporation (OTC: PCRFY), Lithium Americas Corp. (NYSE: LAC)

Electric vehicles powered by lithium-ion batteries help eliminate diesel emissions and this has prompted government officials to push for accelerated deployment of these vehicles, as well as a push to establish new regulations. The shift to electric vehicles is causing battery components such as lithium and cobalt to skyrocket in price, as demand begins to outweigh supply. According to a report by CNBC, Simon Moores, Managing Director of Research at Benchmark Mineral Intelligence, said, “Lithium is coming of age in a big way. It’s the core ingredient to 99% of electric vehicles and as a result, demand is going through the roof.”

MGX Minerals Inc. (OTC: MGXMF) is also listed on the Canadian Securities Exchange under the ticker (CSE: XMG). Yesterday, the Company reported that, “Two sea containers containing a second wastewater treatment system have arrived from the pipe and metal fabricator. The system is scheduled for installation at an oil and gas operation in Albertato treat evaporator blowdown brine. The system, capable of processing high salinity wastewater from SAGD operations, will remove colloidal and dissolved minerals for substantial water reuse, lower cost and reduced environmental liability.

These wastewaters contain lithium in the 100ppm range providing an initial commercial platform for this widely applicable technology. This represents the second system built for this purpose. The first system completed large-scale trials and client acceptance testing and is scheduled for deployment as soon as on-site preparations for installation of the system are completed.

Petrolithium Technology: PurLucid water treatment technologies, which purify wastewater and brine, have been integrated with a newly developed lithium recovery process. Combined, this cleantech process reduces the capital cost of recovery compared to traditional solar evaporation as it does not require the investment in large, multi-phase, lake-sized, lined evaporation ponds, greatly reducing the physical footprint and enhancing the quality of extraction and recovery across a complex range of brines previously considered un-processable due to complexity or geographical location outside of solar evaporation appropriate zones. This includes oil and gas wastewater, natural brine, and other brine sources such as lithium-rich mine and industrial plant wastewater.

The technology was recently chosen as winner of the Base and Specialty Metals Industry Leadership Award at the 2018 S&P Global Platts Global Metals Awards, held in London earlier this month (see press release dated May 18, 2018). Hosted by S&P Global Platts, a leading global energy, metals and commodities information provider, the annual awards program honored exemplary performance in fifteen categories spanning the entire steel, metals and mining complex.”

Albemarle Corporation (NYSE: ALB) is a global specialty chemicals company with leading positions in lithium, bromine and refining catalysts. The Company recently announced double-digit growth in the first quarter on strong lithium results. Lithium reported net sales of USD 298.0 Million in the first quarter of 2018, an increase of 37.8% from the first quarter 2017 net sales of USD 216.2 Million. The USD 81.8 Million increase in net sales as compared to prior year was primarily due to favorable pricing impacts, increased sales volumes and USD 10.8 Million of favorable currency exchange impacts. Luke Kissam, Albemarle’s Chairman, President and CEO, said, “Our lithium capital projects remain on schedule, and, other than some increased raw material costs, the general market dynamics in our business remain positive.”

FMC Corporation (NYSE: FMC) has served the global agricultural, industrial and consumer markets with innovative solutions, applications and quality products. The Company recently announced that Paul Graves, Executive Vice President and Chief Financial Officer, has been appointed Chief Executive Officer for the previously announced new, publicly traded lithium materials company, which will be created by separating FMC’s lithium business in the second half of 2018. Pierre Brondeau will serve as Chairman of the Board of the new lithium materials company. He will continue to lead FMC Corporation as President, CEO and Chairman. “Preparations to separate our lithium business are progressing very well, with an expected IPO in the second half of 2018,” said Brondeau. “It is important that we have a strong executive team in place well in advance of the IPO.

Panasonic Corporation (OTC: PCRFY) is a worldwide leader in the development of diverse electronics technologies and solutions for customers in the consumer electronics, housing, automotive, and B2B businesses. Earlier this year, the Company announced that it has begun mass production of prismatic-type automotive lithium-ion batteries at its factory in Dalian, China, and held a ceremony to mark the first shipment. The market for eco-conscious vehicles, including hybrids, plug-in hybrids, and electric vehicles, is growing every year thanks to the increase in environmental awareness in recent years. To respond to the market demand, Panasonic has been gearing up to start production at this factory, which is its first production site for prismatic-type automotive lithium-ion batteries in China. Amidst expectations of expanding demand for automotive lithium-ion batteries, Panasonic manufactures the high-capacity and high-safety prismatic-type batteries at this factory and ships them to the North American and Chinese markets. Shipments will be expanded in the future to reach more destinations, helping to drive the spread of eco-conscious vehicles. With the beginning of mass production shipments of automotive lithium-ion batteries from this factory, Panasonic now has a production system covering Japanthe United States, and China, the three key global locations.

Lithium Americas Corp. (NYSE: LAC), together with SQM, is developing the Cauchari-Olaroz lithium project, located in Jujuy, Argentina, through its 50% interest in Minera Exar. In addition, Lithium Americas owns 100% of the Lithium Nevada project (formerly Kings Valley project), and RheoMinerals Inc., a supplier of rheology modifiers for oil-based drilling fluids, coatings, and specialty chemicals. Recently, the Company announced its financial and operating results for the year ended December 31, 2017. Development activities continue with the advancement of detailed engineering, camp construction, design and supplies purchases. Earth works, production, well-drilling and hydrological testing are underway. In its Lithium Nevada project, assembled an experienced technical team with backgrounds in exploration, permitting, mining, and lithium processing.

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