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Lithium Is (Still) All The Rage

The global demand for EVs continues to ramp up, exerting tremendous strain on battery metals' supply chains. BofA Global Research predicts the number of new EV model launches over the next few years (2024 - 2027) will outpace new internal combustion engine vehicles for the first time.

Where China is concerned, retail penetration of new energy vehicles (NEVs) stood at 37.3 percent in August, up nine percentage points from 28.3 percent a year earlier and up from 36.1 percent in July - China NEV retail sales up 11.8% MoM to record 716,000 in Aug, CPCA data show.
 

Retail sales of passenger new energy vehicles (passenger NEVs) in China rebounded to a record 716,000 units in August, surpassing the 700,000-unit mark for the first time, according to data released today by the China Passenger Car Association (CPCA). That's up 34.5 percent from a year ago and up 11.8 percent from July.

The Push To Secure Resources

Last week we reported how US-based Albemarle, the world's largest lithium producer, had upped its bid for ASX-listed Liontown Resources to secure two major lithium assets in Western Australia. This may not be the final act as M&A activity in the lithium arena may be about to boil over - Rinehart wins say in Liontown's future in $6.6b takeover twist.

Gina Rinehart, Australia's most prosperous person, according to Forbes, has recently become a "substantial shareholder" in Liontown by acquiring 7.72% of the company's stock. And she may have an appetite for more.

"Gina Rinehart has not ruled out launching a bid to rival Albemarle’s $6.6 billion takeover tilt at Liontown Resources after confirming she now holds a strategic stake in the West Australian lithium prize."

Liontown's mothership Kathleen Valley Project is what's generating all the interest. Deemed the world's largest and highest-grade hard rock deposit of its kind, it boasts a resource of 156 million tonnes grading 1.4% lithium oxide. Next year, the project is expected to begin producing at a rate of 500,000 tonnes of spodumene concentrate per year, expanding to 700,000 tonnes annually by year six.

If another bidder does indeed enter the fray, buckle up as it could be game on for the sector. Companies pushing significant (hard rock) assets along the curve—those demonstrating scale, grade, and a mining-friendly jurisdiction—may already have targets on their back as resource-hungry entities scramble to secure future supply.

A New Discovery Of Potentially Epic Proportions

It's too early to say precisely how this will sway the dynamics underpinning lithium, but a new Li discovery made while Lithium Americas was breaking ground at their Thacker Pass mine is turning heads (and generating heaps of debate concerning future price, supply, and geopolitics) - $1.5 Trillion Dollars Worth Of 'White Gold' Found In Supervolcano On Nevada-Oregon Border.

Researchers from Lithium Americas, GNS Science, and Oregon State University say a caldera measuring 28 miles long by 22 miles wide on the Nevada-Oregon border may contain up to 100 megatons of the battery metal. Hailed the McDermitt Caldera, this colossal resource could dwarf the mega-deposits of Australia and Chile.

Lithium Americas expects to being mining lithium out of its Thacker Pass mine in 2026, and if the mine proves successful and the deposit is as big as the company believes it could be, it could have massive implications for one of the hottest commodities in the world, as it would help the US become independent in its ongoing hunt for lithium.