Why the First Quarter of 2021 Has Been Promising for Lithium Market
FinancialNewsMedia.com News Commentary
PALM BEACH, Fla., April 27, 2021 /PRNewswire/ -- The first few months of the year have been bright for the lithium market, with interest in battery metals increasing as electric vehicles (EVs) take over news headlines around the world. Despite the volatility brought by the coronavirus pandemic to every market, lithium has shown resilience and prices performed on an uptrend during the first quarter. At the end of last year, the trend of declining lithium prices seemed to be coming to an end, with analysts predicting a better price environment ahead. When the year kicked off, Benchmark Mineral Intelligence was already expecting the lithium market to come into tightness in 2021. They said: "But the speed of price increases in Q1 2021 was beyond expectation, with prices for lithium carbonate having nearly doubled in price since the beginning of the year," George Miller told the Investing News Network (INN). "Furthermore, shortages and sold out order books in Q1 were a stark change from Q4 2020, where lithium chemicals were freely available to consumers at lower prices." Active mining stocks in the markets this week include: Lithium South Development Corporation (OTCQB: LISMF) (TSX-V: LIS), Lithium Americas Corp. (NYSE: LAC) (TSX: LAC), Piedmont Lithium Limited (NASDAQ: PLL), Albemarle Corporation (NYSE: ALB), Livent Corporation (NYSE: LTHM).
Commenting on how prices performed in Q1, William Adams of Fastmarkets said he was expecting a bullish outcome on the back of strong demand and restocking. "But the extent of the buying and suddenness of the emergence of tightness was a surprise," he explained to INN. "It soon became apparent that a lot of the surplus that had built up in 2020 has been bought up and stockpiled by a few large users, and that the idle capacity was not ready to restart in a timely manner for various reasons." CRU Group also saw spot prices continue to move higher as expected through Q1. "EV sales across the key regions in Q1 have actually exceeded our already bullish expectations," James Jeary told INN. "On the supply side, there's been plenty of development of projects in preparation for future supply growth, which is unsurprising."
Lithium South Development Corporation (OTCQB: LISMF) (TSX-V: LIS), BREAKING NEWS: Lithium South Development Corporation Drill Program to Expand Resource - Lithium South Development Corporation (the "Company") is pleased announce it is moving ahead with plans to potentially expand the current lithium resource at the Hombre Muerto North Lithium Project (HMN Li Project), located in Salta Province, Argentina.
The 3,287-hectare project is comprised of five separate areas located in the northern portion of the salar. The current resource of 571,000 tonnes of lithium carbonate equivalent is located on the 383-hectare Tramo Claim. The resource was detailed in a National Instrument 43-101 compliant report filed December 4th, 2018 titled, Initial Measured Lithium and Potassium Resource Estimate Hombre Muerto North Project, Salta and Catamarca Provinces, Argentina, authored by independent consultants Montgomery and Associates.
After technical review, management believes the current identified resource has excellent potential to be expanded. To accomplish this, the Gaston Enrique, Natalia Maria and Alba Sabrina claims will be sited for drill programs. The Company has located a service provider who has a drill rig located on the salar near the Alba Sabrina claim block and is negotiating a drill contract. The Gaston Enrique claim block is located on the Catamarca side of the Hombre Muerto salar, and is the oldest claim located within the dual jurisdiction area. Management believes an Environmental Impact Report and drill permits can be obtained for this project area, which is located approximately 100 meters north of a drill hole recently completed by POSCO. A recent corporate video of the HMN Li Project can be viewed at the Company website at www.lithiumsouth.com.
The project area under purchase option to the Company is situated contiguous to significant lithium development. Korean giant POSCO are moving ahead with plans to construct a 25,000 tonne per year conventional lithium extraction operation contiguous to the Company area. The recently announced 4-billion-dollar merger between Galaxy Resources and Orocobre will likely see further development of the Galaxy owned portion further to the south. CONTINUED…. Read this release for the Lithium South news at: https://www.financialnewsmedia.com/news-lis/
Other recent mining developments in the markets include:
Lithium Americas Corp. (TSX: LAC) (NYSE: LAC) has reported financial and operating results for the fourth quarter and year ended December 31, 2020. This news release should be read in conjunction with Lithium Americas' consolidated financial statements and management's discussion and analysis for the year ended December 31, 2020, which are available on the Company's website and SEDAR.
All amounts are in U.S. dollars unless otherwise indicated. Highlights At Caucharí-Olaroz Lithium Project ("Caucharí-Olaroz"): Construction activities at Caucharí-Olaroz continue to advance with enhanced COVID-19 health and safety protocols in place; Capital expenditures for the Project remain on budget with $477 million (84%) of the $565 million committed, including $388 million (69%) spent, as of December 31, 2020; Capital costs attributable to COVID-19 during the construction period, including costs for quarantine and extra camp capacity, are being assessed and now reported separate from the budgeted capital expenditures; Significant progress has been made on the lime plant, solvent extraction plant and lithium carbonate plant; The solar evaporation ponds are well advanced with sufficient brine inventory to support production ramp up; The health and safety of the workforce and surrounding communities remains the highest priority with no positive cases of COVID-19 reported at site in over 130 days; Based on the latest construction schedule, which assumes a reduced workforce at site in accordance with COVID-19 protocols throughout construction, the Company expects first production in mid-2022; In Q1 2021, Marcelo Cabral was appointed General Manager responsible for the development and commissioning of Caucharí-Olaroz. Mr. Cabral was previously with Gold Fields Ltd. and responsible for commissioning MMG Ltd.'s Las Bambas copper project in Peru; and In H1 2021, the Jujuy Energia y Mineria Sociedad del Estado ("JEMSE"), a company owned by the Government of Jujuy province, is expected to complete the exercise of its 2012 participation right, at which point it will receive and hold an 8.5% interest in Caucharí-Olaroz.
Piedmont Lithium Limited (NASDAQ: PLL) recently announced an updated Global Mineral Resource estimate ("MRE") for the Company's flagship Piedmont Lithium Project in North Carolina, USA which includes updated Mineral Resource estimates from the Core and Central properties and an initial Mineral Resource estimate from the Huffstetler property . The total MRE for the project is 39.2 Mt at 1.09% Li2O, with 55% of the MRE currently classified in the Indicated category. The Mineral Resource estimate is reported in accordance with JORC Code (2012 Edition).
Keith D. Phillips, President and Chief Executive Officer, commented: "Increasing the scale of our North Carolina mineral resource to 39.2 Mt at 1.09% Li2O establishes our asset as one of the largest spodumene resources in North America – and the only one in the United States. The expanded resource offers the potential for increased annual lithium production, something we will evaluate as we prepare our updated Scoping Study for release next month. All this is coming together at an ideal time, as the public and private sectors dramatically increase their investment in the electrification of America. Given the scope and strategic location of our Piedmont Lithium Project, we believe we are ideally positioned to play a critical role in helping the United States build a clean energy economy and a U.S. based EV supply chain."
Albemarle Corporation (NYSE: ALB), a leader in the global specialty chemicals industry, recently announced that it has joined the United Nations (UN) Global Compact, a voluntary leadership platform for the development, implementation and disclosure of responsible business practices, and the largest corporate sustainability initiative in the world.
Launched in 2000, the UN Global Compact is a call to companies to align their operations and strategies with ten universally accepted principles in the areas of human rights, labor, environment and anti-corruption, and to take action in support of UN goals and issues embodied in the Sustainable Development Goals (SDGs).
Livent Corporation (NYSE: LTHM) recently reported results for the fourth quarter and full year of 2020.
Fourth quarter 2020 revenue was $82.2 million, a sequential improvement over the third quarter of 13% driven by higher volumes sold and better realized pricing. Reported GAAP net loss was $5 million, or a loss of 3 cents per diluted share. Fourth quarter 2020 Adjusted EBITDA was $5.6 million and adjusted loss per share was 2 cents per diluted share, with both sequential improvements due to higher sales and lower costs from reduced third-party carbonate usage.
For the full year, Livent reported revenue of $288.2 million and GAAP net loss of $19 million, or a loss of 13 cents per diluted share. Full year Adjusted EBITDA was $22.3 million and adjusted loss per share was 5 cents per diluted share. Livent also announced a multi-year supply agreement with BMW Group to deliver both lithium hydroxide and carbonate. Livent has already begun delivering product for qualification and commercial volumes are expected to begin in 2022.
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