U.S. lithium miners' shares charge up on likely Biden EV ord (Reuters) - Shares of U.S. lithium miners climbed for a second straight session on Thursday, after a report that President Joe Biden could invoke a law to encourage domestic production of minerals needed to make electric-vehicle batteries.
Albemarle Corp, Livent Corp and Lithium Americas climbed between 3% and 7%, as the order is expected to help miners access government funding for feasibility studies on new projects that extract lithium, nickel and other EV metals, or to make existing facilities more productive.
"By invoking the Defense Production Act, the Biden administration would presumably be signaling somewhat of a carte blanche endorsement for the domestic EV and battery materials sector," said Christopher Kapsch, senior equity research analyst at Loop Capital.
The order could be invoked as soon as this week, but it was not immediately clear how much funding could be allocated, according to the report.
Kapsch believes the order would likely be a bigger benefit for early-stage lithium miners that have U.S. operations - including Piedmont Lithium Inc, ioneer, Lithium Americas Corp and Standard Lithium - as Biden's order could speed up their production timelines or cut capital costs.
Canada's Standard Lithium gained 11% while Australia's ioneer Ltd closed 20% higher earlier in the day.
"The order could lower the costs to build new capacity. It's unclear if the funds could be used for upstream mining, but at the very least, it would likely be used for building downstream conversion capacity," said Seth Goldstein, equity strategist at Morningstar.