Fear and Lithium in Las Vegas

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canada goose outlet woodbury As locations go for a conference about lithium, Las Vegas is hard to beat. Aside from the obvious, there’s just something apt about this desert cauldron of greed and fear hosting an industry finely balanced between both. canada goose outlet woodbury

canada goose outlet houston This week’s conference, the 10th hosted by Industrial Minerals, was, by all accounts, the best attended ever, with a notably strongcontingent of finance types. Lithium has been on a quiet tear, as some of that Muskianaura around electric vehicles has lit up prospects buy canada goose jacket cheap for the metal embedded in the batteries. Since I wrote this column canada goose black friday sale in early 2016, prices have roughlydoubled: canada goose outlet houston

canada goose factory outlet Investors noticed. The Global X Lithium Battery Tech ETF, valued at Canada Goose sale less than $50 million in early 2016, has received more than $900 million of net inflows since, according to data compiled by Bloomberg. canada goose factory outlet

canada goose womens outlet With such windfalls often comes a dose of anxiety, however. Look canada goose uk black friday back at that chart of lithium prices and you’ll notice theslight dip toward the right. Coupled with a bearish analyst report Morgan Stanley published in February widely referenced in Vegas, if canada goose clearance sale seldom praised it teed up what brokers refer to as a breather: canada goose womens outlet

canada goose outlet in chicago This leaves the Canada Goose online industry in a curious position. canada goose outlet in chicago

canada goose outlet online uk On canada goose store one hand, theopportunity is undeniable. For reasons encompassing cost, environmental benefits and energy security, electric vehicles will eat into the car marketover time, especially in Asia. The exact gradient of growth is debatable, but it slopes up and to the right. Benchmark Minerals Intelligence, a research and data firm, projects demand to rise from about 220,000 tonnes of lithium carbonate equivalent last year to more than 900,000 in 2025 and around 2 million by the early 2030s. canada goose outlet online uk

canada goose victoria parka outlet But the routeis fraught with doubt. At first glance, developing the lithium required doesn’t look that demanding. Tom Schneberger, FMC Lithium’s COO, said this week perhaps $15 billion of investment was needed to boost supply over the next seven years or so. That’s less than what one oil major spends in a year. When lithium’s top three producers have a collective market cap of only $31 billion or so, though, it’s a heavy lift, especially given the metal’s peculiarities. canada goose victoria parka outlet

canada goose outlet online store review For starters, it can only loosely be called a commodity. Lithium comes in different compounds, and the battery grade stuff, especially, must be exceptionally pure and canada goose factory sale tailored to manufacturers’ specifications. So unlike, say, aluminum, lithium isn’t homogenous canada goose coats on sale (it’s like iron orein this respect, only more so). That complication, along with it being a relatively small market dominated by a few suppliers and customers, makes it tough to talk about a lithium “price” (Benchmark Minerals tracks 11 of them). That makes it tough to hedge and, therefore, secure financing fornew projects. canada goose outlet online store review

buy canada goose uk Compounding this are myriad other uncertainties. On the supply side, there is fear that South America’s majors such as SociedadQuimicay Minerade Chile SA, or SQM, will swamp the market (the Morgan Stanley thesis, essentially). They control the cheapest lithium resources, with a cash cost of maybe $5,000 to uk canada goose outlet $8,000 a tonne. buy canada goose uk

canada goose jacket uk As for demand, multiple battery technologies, each using canada goose clearance different combinations of metals, compete; and there aremore exotic innovations such as solid state batteries coming. Then there’s the potential size of the market to consider. That depends not onlyon how many electric vehicles get sold, but cheap Canada Goose also what kind, a point emphasized to me this week by Jon Hykawy, president of Stormcrow Capital. Many Asian buyers, in particular, won’t necessarily want high power, buy canada goose jacket high capacity models such as Tesla Inc.’s. canada goose jacket http://www.canadagoosecanadaoutlet.com uk

canada goose outlet uk sale Using Canada Goose Parka very basic assumptions, selling 10 million electric vehicles with an average battery size of 50 kilowatt Canada Goose Coats On Sale hours and 0.9kg of lithium per kWh adds up to 450,000 tonnes of demand in 2025. Tweak the number of vehicles and battery size down by 10 percent each, though, and that drops by 19percent, or 86,000 tonnes more than the current production of Albemarle Corp., one of today’s top three producers. canada goose outlet uk sale

canada goose outlet vip This uncertainty is why the wobble in prices hit the junior companies harder. The Vegas conference reminded me in some ways of oil conferences from five years ago, with the boom paying for many a stall manned by somesmall fracker you had never heard of. Intuitively, you know many of these companies will not exist in five years and that the downward bit of the cycle looms as supply ramps up. canada goose outlet vip

canada goose outlet eu And yet, outright despair isn’t warranted. Paradoxically, some excess capacity and lower prices aren’t bugs, but features of what comes next. canada goose The very uk canada goose fact that a lot of vaunted projects won’t happen, along with inevitable delays for many that proceed, should cap fears of excess supply. Success for junior companies will require credible management with a successful track record, in an industry where such things are by definition scarce,along with creativity onmoney raising. Names that spring to mind include James Calaway, chairman of Global GeoscienceLtd. and former chairman of established producer Canada Goose Outlet OrocobreLtd., and NemaskaLithium Inc., which recently pulled together a 1.1 billion Canadian dollars smorgasbord of funding, encompassing bonds, forward sales of lithium and, most notably, an equity canada goose uk shop investment by SoftbankGroup Corp. canada goose outlet canada goose outlet eu

canada goose outlet website legit Ultimately, much of the money over the next five years or so will have to come from downstream buyers seeking to secure supply. Chinese processors of lithium canada goose uk outlet ores have been doing this aggressively already (another thing that seems to provoke greed and fear in equal measure right now). canada goose outlet website legit

canada goose parka outlet uk But the automotive sector, especially, will have to step up. For thosethat havecommitted to an electrified strategy, security of lithium supply is critical without it, those new cars simply won’t be built. In that context, whether lithium costs $10,000 or $20,000 a tonnein the early 2020sisn’t irrelevant, but is less important. canada goose parka outlet uk

canada goose outlet michigan Lithium’s losing streak may well carry on through the rest of 2018 canada goose coats (Chinese pricing post the introduction of new electric vehicle incentives will be the indicator to watch). For those with a longer view, the odds are canadian goose jacket still stacked heavily in its favor canada goose outlet michigan.