|This is my cobalt speculation, going parabolic?|
Sunday, April 24, 2016
Cobalt story starting to get picked up
Is Tesla doomed?
Don't get me wrong; the company has some great value and is driving the lithium revolution...
But there are so many challenges ahead.
The largest, of course, is figuring out how to scale up production of its cars. Remember, more than 400,000 future customers have laid down their deposits for the Model 3, and I wouldn't be surprised to see another surge in pre-orders before the cars roll off the assembly line.
Then there's one incredibly profitable problem: the lithium supply Tesla hasn't completely secured yet.
That alone has caused a sudden surge in demand, ultimately pushing prices sky high.
And now the same thing is about to happen to another commodity, one that's in an even worse situation:cobalt.
IF Tesla can ramp up...
IF a steady supply of lithium can be found...
And IF the world can keep — and increase — its cobalt production... then early investors in the booming battery field are set to make a fortune or two.
It's a lot of ifs, isn't it?
I think it's safe to say that most people are confident that Musk can deliver on the first, and the lithium revolution taking place in Nevada is helping to shore up Tesla's desperately needed lithium supply.
I have no idea if Tesla will succeed and I really do not care. The lithium and cobalt supply story is much bigger as it is not just EV batteries but stationary storage of wind and solar that are also taking off. Not to mention both of these metals are by-products of other mined minerals. I just do not see where the supply will come from in the near term. Yet we are ramping up green energy as fast as we can. Looks like higher prices for lithium and cobalt are going to be the order of the day.