This is an interesting development. SQM might take a hit on this news, depending on a lot of things. Need more info. Berkshire's lithium venture may supply U.S. automakers, including Tesla: FT January 20, 2019 / 2:28 PM (Reuters) - Warren Buffett’s Berkshire Hathaway Inc has signed an agreement to allow extraction of lithium from its geothermal wells in California, a project that could offer U.S. carmakers and battery producers a secure supply of the metal, the Financial Times reported on Sunday. The venture has been in talks to supply Tesla Inc with lithium, a component for batteries to power electric cars, the newspaper reported, citing people familiar with the company. Berkshire Hathaway’s geothermal wells could produce up to 90,000 tonnes of lithium a year worth $1.5 billion at current prices, the report said, citing a fundraising document. “We see a lot of interest in getting North American supply as automakers start to get further into electric vehicles,” the FT quoted Eric Besseling, a vice president at BHE Renewables, as saying. Berkshire Hathaway Energy Co and Tesla did not immediately respond to a request for comment outside normal business hours.
Here are the cons (as against the pros) which I see. 90,000 tonnes out of geothermal bore(s) seems like an exaggeration, but if it were possible it would come out the ground wet and would require special extraction considering geothermal is hot, steamy and under pressure, it would possibly be a slurry. Now these guys have some competitors..... Just down the road in Nevada, 340km from Tesla factory is Ioneer mine, who anticipate dry mining of Lithium off the surface in 2021. 4.1 million tonnes of Lithium carbonate, 11 million tonnes of boric acid and that's just what initial exploration has found. https://www.ioneer.com/rhyolite-ridge/overview
Lithium has been one of the worst performing sectors that I can see over the past 12 months. For a metal that had such high expectations, it has been very disappointing from an investment perspective. That may be about to change. Looks like it is finally ready to pop.
Price rising, hehe. No, there's more to the Colonel Sanders recipe.... Van, what are you looking at re lithium prices, where do you go as there is no lithium futures or index...?
I just keep SQM and ALB on my watchlist, albeit neither are pure-plays really, but they do seem to move with sentiment. SQM looks to be consolidating down here around $41-$42 after that nightmare before xmas market clusterfvck. That said, as you probably well know, these stocks are very difficult to understand and analyze from a FA perspective. So many divisions, and they are extremely sensitive to geopolitical and currency anomalies. They suck to day/swing trade and to hold for the long haul, one better be an expert or at least rely on an expert analyst. That may be you but it sure ain't me. The Colonel lol.... he's doing very well in China, YUMC just broke out to the upside. They apparently haven't cracked the code to the Colonel's intellectual property yet (salt and pepper). Give em time.
There are not many pure play lithium stocks listed, probably Australia though has the most. MIN.AX Mineral Resources is Iron Ore and lithium but seems to trend with lithium prices rather than iron prices and a top quality well managed company. Other lithium stocks in Oz are GXY.AX, KDR.AX, PLS.AX, ORE.AX. However imo the best guage to use is the ETF, 'LIT', appearing to be the best approach. Price breaking above 1 month high is where to look at this point in time. Nickel appears quite correlated, surprisingly Cobalt isn't.
2018 was a weird year for the electric vehicle metal miners. While we saw a massive 70% growth in electric car sales in 2018, most of the lithium/cobalt/graphite/nickel miner’s stock prices fell in the wake of some oversupply fears and concern over the trade war and China’s slowdown. Of course for greater context it should be noted that 2016 and 2017 saw stellar years with many electric vehicle (EV) metal stocks doubling, tripling or more. What will 2019 bring? Analysts are somewhat mixed in their 2019 forecasts. For lithium some are forecasting oversupply and weak lithium prices, while others maintain lithium prices will remain high due to strong demand and the typical lithium supply lag. What we can say with some confidence is that any junior EV metal miner that can make significant progress towards production is likely to do well, especially assuming electric vehicles continue to grow rapidly. It is easy to forget we may be looking at a 54 fold increase in electric cars between 2017 and 2040, based on Bloomberg’s forecast. Other research firms are increasingly making similar forecasts, and the battery supply chain is gearing up with 68 mega-factories already in the planning or construction stage. Many cities and countries are even banning or punishing petrol or diesel cars to reduce carbon emissions. All this means that from now to 2040 at least, we are very likely to see an unprecedented demand pull on the EV metals – Lithium, cobalt, rare earths, graphite, nickel, and copper. The chart below (courtesy of Bloomberg) shows the impact that a 100% EV world would have on the key EV metals, noting those with smaller markets like lithium and cobalt would feel the greatest impact. Lithium would see a 29 fold demand increase. https://investorintel.com/sectors/t...is-an-early-stage-lithium-buying-opportunity/