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Lithium mine "open grab" press the accelerator button! European and American frequently shot
In recent years, the new-energy vehicle industry has become increasingly hot, and countries around the world are accelerating the transition to new energy vehicles. Therefore, countries are paying more and more attention to power batteries and their upstream lithium resources. In terms of power batteries, according to the latest data from SNE Research, a recent market research organization, among the top ten companies in the global power battery installations in the first quarter of 2022, CATL, BYD, China Innovation Airlines, Guoxuan Hi-Tech, and Honeycomb are from China. Energy and Yiwei Lithium occupy 6 seats, which is enough to show the strength of China's power battery companies.
China's dominance in the battery metals industry is forcing the US and Europe to respond. The Biden administration has more than once mentioned accelerating the production of key battery metals in the United States; and Albemarle Corp., the world's largest lithium miner, is also building its U.S. supply chain.
Albemarle Corp. is planning to build a facility to convert virgin lithium into a chemical used to make electric vehicle batteries, said Kent Masters, chief executive of Albemarle Corp. The company is also doubling the capacity of its largest Silver Peak mine in Nevada and may restart another mine in North Carolina. The Charlotte, N.C.-based plant in Albemarle is expected to come online in four to five years, according to Lithium President Eric Norris.
And RJ Scaringe, CEO of US electric vehicle startup Rivian, has previously warned that the current chip shortage may be just an "appetizer" compared to the impending battery shortage. A report released by the Center for Automotive Research (CAR) shows that battery production will not meet demand by 2030, and more than 18.7 million electric vehicles worldwide are expected to lack batteries between 2022 and 2029; Tesla CEO Musk has also repeatedly mentioned that the supply of battery raw materials may become a major problem, and has repeatedly called on raw material suppliers to mine more mines, especially lithium mines. In an interview on May 10, Musk again mentioned that Tesla is unlikely to acquire other automakers in the future, but there is a possibility of acquiring a mining company.
The price of lithium has more than tripled in the past year as mining has lagged demand for electric vehicles, according to Benchmark Mineral Intelligence, and the cost is high enough for the industry to understand the importance of the raw material sex.
Therefore, many domestic and foreign manufacturers have recently entered the lithium market. On Monday, commodities trader Trafigura also announced plans to invest in a new lithium refinery in the UK. As part of the investment, Trafigura, one of the world's largest metals traders, will source raw materials for Green Lithium, which plans to build a factory in the north of England that will produce 50,000 tonnes a year and sell the finished product to customers across Europe.
In addition, on May 4, Australian AVZ Mining Company announced that its subsidiary Dathcom Mining Company officially obtained the mining license for the Manono Lithium-Tin Mine Project. The latest report shows that the production capacity of the Manono mine will be expanded from the previous 700,000 tons of SC6 lithium concentrate to 1.6 million tons, and the service life will be expanded from 20 years to 29.5 years.
The Chilean side has also been striving for the nationalization of lithium and copper mines, but the related process of the proposal has been repeatedly blocked. At the Constitutional Convention last Saturday, the proposal was rejected again; and the Mexican side on April 19th. A bill introduced by President AMLO was passed in the afternoon to give priority to private investment in lithium mining to state-owned enterprises. President AMLO said that lithium is becoming more and more important as a component, including in automotive batteries. Mexico will review existing lithium mining contracts, including a lithium project built by Ganfeng Lithium in Mexico. If the proposal is finally passed, oil and lithium will be listed as strategic minerals in Mexico.
In addition to foreign companies, domestic companies have also made frequent moves in the layout of lithium resources recently. Battery maker Guoxuan Hi-Tech signed a memorandum of understanding with Argentina’s state-owned mining company Jujuy Energía y Minería Sociedad del Estado (JEMSE) on a potential collaboration to build a local refinery of battery-grade lithium carbonate. In Zimbabwe, Shengxin Lithium Energy and China Mining Resources will form a joint venture to strengthen cooperation in lithium mining projects.
Mining giant Tianqi Lithium has cooperated with battery manufacturer China Chuangxinhang. In addition to reaching the "Lithium Carbonate Supply Framework Agreement", the two companies will also conduct research on battery cells and battery materials, new materials, lithium salts, lithium mines and other fields. Carry out cooperation in various fields such as joint investment and cooperative research and development.
China Mining Resources also announced on May 10 that the company and Shengxin Lithium Energy will set up a joint venture in Zimbabwe, continue to look for other lithium ore projects there, and speed up the promotion of the two parties' mid-to-early lithium ore mining rights projects in Zimbabwe.
However, although the layout of a number of companies in lithium mines and lithium salts is in full swing, the price of domestic lithium salts has continued to stabilize in the near future after a wave of declines. The average spot price of domestic battery-grade lithium carbonate is stable at 461,500 yuan / ton, while lithium hydroxide has fallen slightly by 1,500 yuan / ton recently, and the average price is 467,500 yuan / ton.
At the same time, the price of metal lithium has also continued to decline. According to the SMM spot price, as of May 11, the average spot price of metal lithium has dropped to 3.055 million yuan / ton, and has plunged by 10,000 yuan / ton for four consecutive trading days.
CITIC Securities said that as the selling price of lithium concentrate in Australia is expected to rise above US$5,000/ton in 22Q2, the production cost of domestic lithium salt companies will rise to 400,000 yuan/ton. As the domestic lithium price has fallen from a high level since the second quarter, this will lead to a narrowing of the profitability of domestic lithium salt companies, and the first quarter of 2022 may become the highest profit point for lithium salt companies that purchase lithium concentrates. At the same time, due to the cost support brought by the rising price of lithium concentrate, the downward space of domestic lithium price is limited, and the price may stop falling by the middle of the year.
