Investors pile into lithium producers
Double-digit rise
Peter Koven, Financial Post
Published: Friday, August 14, 2009
Little-known lithium has emerged as the hot commodity of the moment as investors look for a way to cash in on the anticipated flood of electric cars to the market.
The lithium mania yesterday swept up a number of Bay Street institutions, which were buying anything for clients that happened to have the magic L-word in its name.
By the end of the day, explorers and developers of lithium properties -- Canada Lithium Corp., Western Lithium Corp. and First Lithium Resources Inc. -- were up 41%, 28% and 67%, respectively, on massive volumes.
"I just think people are realizing there are going to be an awful lot of lithium batteries used in electric vehicles over the next while," said Jon Hykawy, an analyst at Byron Capital Markets.
He said if a couple of million electric cars are sold in the next five years, that alone would equate to about 10% to 15% of current lithium demand.
The market for lithium, a very light silver-white metal, has grown steadily over the past decade thanks to rising demand for batteries in such consumer electronics as cellphones and laptop computers.
But it is the pending release of the Chevy Volt, the Nissan Leaf, and other electric vehicles that is getting investors most excited.
Some auto companies are already speculating that pure-electric cars could make up 10% of vehicle purchases by 2020, which could put major strain on lithium supplies if it happens.
"The real inflection point is that an automobile needs about 3,000 times as much lithium as a cellphone. This is where we've got a very large potential supply requirement," said Jay Chmelauskas, president of Western Lithium.
The fact that the electric car build-out is getting billions of dollars of subsidies and strong political support, particularly in the United States and China, only adds to the excitement for lithium. In the United States, the support comes as no surprise given the government controls General Motors. But China has also emerged as a leader in electrification. It is the world's largest car market, and experts said that almost every company producing lithium-ion batteries for cars has a plant in China.
The lithium industry is small, with annual production of only about 120,000 tonnes of lithium carbonate. There are also very few ways for investors to get involved in the sector, as it is dominated by four companies: SQM SA of Chile, Rockwood Holdings Inc., FMC Corp., and Talison Minerals Pty Ltd., a private Australian company. "And then you've got a wackload of juniors that are doing anything from the sublime to the ridiculous to come up with lithium," Mr. Hykawy said.
He said that the price of lithium, which is not widely published, reached about US$6,600 a tonne this month. That compares with about US$2,500 a tonne at the beginning of the decade.
The biggest source of lithium is Chile; Argentina and Australia are major producers as well. Bolivia is described by some as the Saudi Arabia of lithium, but experts said that a lot of the deposits there are contaminated with magnesium and are too costly to mine. Political risk has also kept many companies out.
www.nationalpost.com/story.html?id=1891696
Avatar #127 von rudi8306 Benutzerinfo Nachricht an Benutzer Beiträge des Benutzers ausblenden 15.08.09 18:27:14 Beitrag Nr.: 37.788.619
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special meeting of shareholders (the "Meeting") of the Company will be held on Tuesday, August 25, 2009, at 10:00 a.m. (Toronto time)
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Lithium may be a light metal, but it could be the next gold, speculators suggest
Jonathan Ratner, Financial Post
Published: Saturday, August 15, 2009
The flurry of new interest surrounding lithium as the commodity of choice for a play on the emerging electric-car market has put several once-penny stocks on investors' radars. One such name is Rodinia Minerals Inc. (RM/TSX-VEN). The Vancouver-based company saw its shares jump more than 50% this week to above 65¢. It's up 1,100% in 2009. While the recent surge of interest is a result billions of dollars in subsidies for electric vehicles such as the Chevy Volt and Nissan Leaf, rising demand for lithium-ion batteries in products such as laptops and cellphones has also helped. Rodinia has a brine deposit in Nevada, which Rick Mills at AheadoftheHeard.comsuggests might just be America's own Saudi Arabia for lithium. While the supply-demand situation for lithium is relatively balanced, if an electric-automotive industry is in fact developed, bulls on the light metal anticipate a supply shortfall in the future. At right, the Volt battery pack.
www.financialpost.com/news-sectors/technology/story.h…