Thursday, October 20, 2016

Joe Lowry interview on lithium production and pricing

Investing News:

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I believe in 2015 the total lithium market was approximately 163,000 metric tons and will grow to about 182,000 metric tons in 2016. I only use lithium that was sold as a chemical. If someone uses ore in an end-use it’s not in my numbers. I presented the new numbers at a Benchmark Minerals event in Silicon Valley early this month.

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 I have a really hard time–even with my moderate 2020 demand number of 312,000 metric tons keeping the supply ahead of demand in my model. It stays in balance to 2020 only with substantially more hard rock capacity – Mt. Marion, Mt. Cattlin and later Pilbara converted to lithium chemicals in China for the most part. The number of suppliers will increase. Companies like Ganfeng and Tianqi will be increasingly significant. Others like FMC who fail to expand resource capacity will decline in significance.

It seems that supply will have a problem meeting demand in the mid term. Higher prices will cure that situation. I like to follow Lowry's research as his whole career has been in the lithium market and he probably knows more about it than anyone I can find. he usually posts his views on LinkedIn but he has a twitter account which I also follow. If you are interested in the Lithium space you should consider his opinions. 

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