DOWNLOAD: Lithium, cobalt prices enter new period of volatility as era of EV begins; vanadium awaits lithium ion moment

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Lithium and cobalt prices are experiencing a new period of volatility as prices crest from post-2010 highs. Both speciality minerals that are key components in an electric vehicle’s lithium ion battery began to see a downward turn in 2018.

The Benchmark World Tour 2018 – the world’s leading investor forum for lithium ion supply chain and in its 4th year – explored these themes in Hong Kong, Seoul, Tokyo, Perth, Melbourne and Sydney over the last two weeks. Download presentations from the Benchmark World Tour below.

Lithium industry’s reference price

Lithium price declines have been a long-awaited expectation due to perceived oversupply in the market and some investors are using the China ex-works lithium carbonate price as the proxy for the industry’s state of play.

The reality is that a specific grade of Chinese lithium carbonate has been hit hard by declines for a variety of reasons, but the rest of the world prices and Chinese lithium hydroxide remain robust.

Benchmark Mineral Intelligence sets the lithium industry’s reference price each month to a lithium-specific methodology and it’s the world’s leading independent specialist in the lithium ion battery supply chain.

In China, lithium carbonate expansions in Qinghai from 15,000 tpa to an expected 25,000 to 30,000 tpa LCE in 2018 have proven a major factor in domestic price declines for lower quality – and not battery grade – material.

The August 2018 assessment of Benchmark Minerals’ Lithium Hydroxide, China EXW, 55% min LiOH, stood at a midpoint average of $19,500/tonne. This has fallen 15% from a 2018 high of $23,000/tonne in March 2018.

Yet in the same period Benchmark Minerals’ Lithium Carbonate, 99% Li2CO3, EXW China, Technical Grade price assessment decreased 48% from $22,500/tonne in March 2018 to $11,500/tonne.

Benchmark Minerals’ Lithium Price Assessment – Subscribe today for access, Rob Nichols: [email protected]

“We are at the end of the lithium hype and at the beginning of the real story,” Benchmark Minerals’ Managing Director, Simon Moores, explained to the Seoul and Tokyo World Tour 2018 delegates.

“Sentiment has driven much of the lower quality lithium carbonate prices down rather than just new supply from China. Yet, rest of the world prices and medium-term contracts are more robust”.

“We believe any softness in lithium price will be used as an ideal moment to secure long-term deals which in turn will support stronger medium-term lithium prices,” he added.

Cobalt’s cash flow problems

Cobalt has had a tougher 2018 compared to lithium with price decreases being the main industry theme of 2018.

Benchmark Minerals’ Cobalt Sulphate, 20.5% CoSO4, EXW China price assessment peaked in April 2018 at a mid-point average of $22,515/tonne and has declined to $13,870/tonne in our latest assessment in August 2018.

Experiencing a similar trajectory, Benchmark Minerals’ Cobalt Battery Metal, 99.8%, EXW Europe price assessment peaked at $96,177/tonne in April 2018 and has fallen to $74,405/tonne in August 2018.

Benchmark Minerals’ Cobalt Price Assessment – Subscribe today for access, Rob Nichols: [email protected]

Benchmark believes the issue with cobalt began at the end of last year when payables for cobalt hydroxide increased sharply under new supply contract negotiations that were eating into refiners’ margins.

With a backdrop of rising prices, some parts of the supply chain changed payment terms to upfront before delivery where previously they invoiced after delivery.

“Cashflow has become an ever-increasing problem in cobalt and has impacted buying patterns which has resulted in hand to mouth purchasing,” Benchmark’s Cobalt & Cathodes Analyst, Caspar Rawles explained to Australian World Tour 2018 delegates.

“At the same time Chinese deleveraging has impacted what little credit is available. Sentiment began to shift in China in April and remains in a similar position today,” he added.

Other demand-side factors that have affected cobalt’s price fortunes include China’s introduction of a new subsidy policy that has further impacted raw material purchases as lithium ion battery cell and auto manufacturers adjusted to the new policy.

Vanadium’s lithium ion moment  

Vanadium made its debut appearance on the Benchmark World Tour 2018 as the discussion around the energy storage market heated up.

The recent success of lithium ion batteries being deployed in increasing larger systems that are exceeding 1GWh has brought to light the huge potential of the market for all types of battery technologies.

Vanadium flow technology has, for many years, been a favoured technology to enter this space in a serious way and Benchmark forecasts that it could be a major player in this market, second to lithium ion.

“If a vanadium battery producer steps forward with bold plans to produce vanadium flow at mass scale, giving the industry its Elon Musk for lithium ion moment, the potential for the technology to be the second most deployed ESS battery in the world is there,” Benchmark’s Simon Moores explained.

“Raw material self sufficiency is a critical component to this. At least a third of the cost of a vanadium flow battery is the raw material vanadium pentoxide which makes up the liquid electrolyte.

“If companies are thinking of creating the Gigafactory of vanadium flow batteries, they will either need to own a mine or implement a new pricing system where the fully recyclable  vanadium in the battery is leased,” Moores added.

Should all of vanadium’s supply chain challenges be solved, Benchmark believes 25% of the energy storage market is up for grabs in 2028 and it forecasts that the energy storage market will then be between 100GWh to 120GWh in size.

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Download World Tour 2018 Presentations

Hong Kong, Monday 10 September 2018

Cobalt & Cathodes: How are cathode materials evolving to deal with the cobalt conundrum? | Caspar Rawles, Analyst, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Standard Lithium – Robert Mintak, CEO & Director

Neometals – Michael Tamlin, COO

Battery Minerals Ltd – David Flanagan, Managing Director

Savannah Resources – David Archer, CEO

Lake Resources NL – Steve Promnitz, Managing Director

Battery recycling is getting serious | Impact of secondary materials on the lithium ion value chain | Hans Eric Melin, Director, Circular Energy Storage (Subscriber only access, email Rob Nichols at [email protected] )

Seoul, Wednesday 12 September 2018

How Benchmark Minerals is enabling a new lithium price mechanism for the EV revolution | Simon Moores, Managing Director, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Lake Resources NL – Steve Promnitz, Managing Director

Cobalt 27 – Martin Vydra, Head of Strategy

Neometals – Michael Tamlin, COO

First Cobalt – Trent Mell, President & CEO

What can compete with lithium ion batteries in EVs and Energy Storage and by when? | Caspar Rawles, Analyst, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Tokyo, Friday 14 September 2018

https://twitter.com/sdmoores/status/1040509953369239553

How Benchmark Minerals is enabling a new lithium price mechanism for the EV revolution | Simon Moores, Managing Director, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

The battery and EV supply chain perspective from an Auto major | Kazuhiro Araki, Assistant Chief Engineer, Honda R&D (Subscriber only access, email Rob Nichols at [email protected] )

Neometals – Michael Tamlin, COO

Lake Resources NL – Steve Promnitz, Managing Director

Standard Lithium – Robert Mintak, CEO & Director

Cobalt 27 – Martin Vydra, Head of Strategy

First Cobalt – Trent Mell, President & CEO

What can compete with lithium ion batteries in EVs and Energy Storage and by when? Caspar Rawles, Analyst, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Perth, Monday 17 September 2018

Have we underestimated the energy storage market? Sam Jaffe, Managing Director, Cairn Energy Research Advisors (Subscriber only access, email Rob Nichols at [email protected] )

Pilbara Minerals – Pilgangoora and the Hard Rock Revolution | Ken Brinsden, Managing Director & CEO, Pilbara Minerals Limited

Standard Lithium – Robert Mintak, CEO & Director

Hexagon Resources – Mike Rosenstreich, Managing Director

Fortune Minerals – Robin Goad, President & CEO

21st Century Vanadium: Raw Material Security, spiking prices and impact on ESS | Vincent Algar, Managing Director, Australian Vanadium

Lithium: The Pathway to One Million Tonnes | Chris Berry, President, House Mountain Partners LLC (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Celsius Resources – Brendan Borg, Managing Director

Global Geoscience – Bernard Rowe, Managing Director

How are battery technologies changing EV and stationary storage? Simon Moores, Managing Director, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Cobalt & Cathodes: How are cathode materials evolving to deal with the cobalt conundrum?  Caspar Rawles, Analyst, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Melbourne, Wednesday 20 September 2018

Have we underestimated the energy storage market? Sam Jaffe, Managing Director, Cairn Energy Research Advisors (Subscriber only access, email Rob Nichols at [email protected] )

Pilbara Minerals – Pilgangoora and the Hard Rock Revolution | Dale Henderson, Chief Operating Officer, Pilbara Minerals Limited 

Global Geoscience – Bernard Rowe, Managing Director

Fortune Minerals – Robin Goad, President & CEO

Celsius Resources – Brendan Borg, Managing Director

21st Century Vanadium: Raw Material Security, spiking prices and impact on ESS | Vincent Algar, Managing Director, Australian VanadiumLimited

Cobalt & Cathodes: How are cathode materials evolving to deal with the cobalt conundrum? Caspar Rawles, Analyst, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Core Exploration – Stephen Biggins, Managing Director

Standard Lithium – Robert Mintak, CEO & Director

Piedmont Lithium – Keith Phillips, President & CEO

Graphite evolution: The rise of the world’s biggest graphite mine | Shaun Verner, Managing Director, Syrah Resources 

Lithium: The Pathway to One Million Tonnes | Chris Berry, President, House Mountain Partners LLC (FREE DOWNLOAD – Subscriber only access, email Rob Nichols at [email protected] )

What can compete with lithium ion batteries in EVs and Energy Storage and by when? Simon Moores, Managing Director, Benchmark Mineral Intelligence  (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Sydney, Friday 22 September 2018

What can compete with lithium ion batteries in EVs and Energy Storage and by when? Simon Moores, Managing Director, Benchmark Mineral Intelligence (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

The Battery Revolution | Lachlan Shaw, Global Commodity Strategist, UBS 

21st Century Vanadium: Raw Material Security, spiking prices and impact on ESS | Vincent Algar, Managing Director, Australian Vanadium Limited

Core Exploration – Stephen Biggins, Managing Director

Standard Lithium – Robert Mintak, CEO & Director

Battery Minerals Ltd – David Flanagan, Managing Director

Pilbara Minerals – Pilgangoora and the Hard Rock Revolution | Ken Brinsden, Managing Director & CEO, Pilbara Minerals Limited

Have we underestimated the energy storage market? Sam Jaffe, Managing Director, Cairn Energy Research Advisors (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

Celsius Resources – Brendan Borg, Managing Director

Fortune Minerals – Robin Goad, President & CEO

Global Geoscience – Roger Howe, Manager, Corporate and Investor Relations

Cobalt & Cathodes: How are cathode materials evolving to deal with the cobalt conundrum? Caspar Rawles, Analyst, Benchmark Mineral Intelligence(FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected]benchmarkminerals.com )

Piedmont Lithium – Keith Phillips, President & CEO

Lake Resources – Steve Promnitz, Managing Director

Blackstone Minerals – Scott Williamson, Managing Director

Lithium: The Pathway to One Million Tonnes | Chris Berry, President, House Mountain Partners LLC (FREE DOWNLOAD – usually subscriber only access, email Rob Nichols at [email protected] )

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