RE:RE:More Bad Newsanother article was relased by Investing News Network on the Rio Tinto activities for lithium.
It reaffirms what i said the other day about some of these big miners or possibly energy companies, will need to do acquisitions sooner rather than later if they want to participate in the lithium potential the next 20 years. These are large companies with deep pockets, but have zerio experience in lithium. What Rio Tinto is spending for 5000 Li in production, would go a long way if it was spent on CYP which has so much more potential. But, as inferred, lithium is all new to these companies.
"Similarly, battery metals expert Chris Berry, founder of House Mountain Partners, said this is not particularly significant for lithium supply going forward.
“Producing 5,000 to 15,000 tonnes per year is not terribly impactful in a market that is growing at a CAGR of 18 percent and expected to be 850,000 to 1 million tonnes in size by 2025,” he said. “If Rio Tinto wanted to be a significantly sized lithium player, they are better off doing this through M&A and buying one of the major producers.”
He added that considering the company’s revenue and operating income in 2018, for lithium to “move the needle” for Rio, the company will need to either build or buy significant production.
If Rio Tinto wants to be successful at processing lithium it will need to prove to end users that it can produce high-quality lithium chemicals at scale, said Berry.
“This could take longer than many think, which is why entering the business through acquisition makes more sense for them.”