Originally posted by newbie2016
Lithium is So hot currently, this results in many junior mining companies turn to join this big party, also, the existing giant lithium companies want to expand their production capacity.
From the past several years, lithium price surged 2 to 3 times of 2015's price. With so many new entries and the planning expantion of current production, Morgan Stanley predicted lithium price would droped 45% by 2021. This is So risky for the junior companies who seek to produce lithium only.
ASN has multiple minerals, which diversified the risk and can generate multiple revenue as well.
Lithium market might be stuck for a couple of years, for the juniors or the new entries, especially for the companies who still use evaperation pond and old technology, might face a difficult situation to survive, as the profit margin is So low (cost high), also, the high cost for building plant.
Oppositely,
1. the Bromine and Iodine demand are predicting to increase 3% per year till 2025 (I posted a couple days ago), so, ASN has more safe situation and competitive advantage comparing the junior rivals and new entries from my own opinion.
2. The cutting age tech can save a lot of time, money and space for ASN.
DYOR
Hey mate,
Lithium ain’t so hot at the moment, most lithium stocks down between 40-80% since the party in January 2018.
If you read closely you will see that MS early last year released a report about an oversupply looming, this would result in a 30% decreace in price by 2020, and a 50% decline by 2022. What they neglected to mention was the fact that they had based their figures on the sheet product the Chinese were producing that was unable to be sold due its shear lack of quality. In the meantime they shorted large lithium producers like GXY, driving prices down even further. Whilst they made progress driving prices down they also went shopping picking up hoards of lithium shares in the aftermath left after their devious deed.
Lithium prices have seen the bottom, even the crap produced in China seems to have bottomed out. Carbonate is on the slow up, and won’t bow to hydroxide any time soon.
Those big players that were supposed to have increased their production are going anywhere!
where you looking? Chile, going backwards, Canada, look no further than Nebraska. None of the Big Aussie companies are hitting their nameplate and delays are evident.
As demand increases, I do not not see supply increasing at all. I see the exact opposite occurring, we are looking at a major shortage starting in 2020.
With most car makers yet to secure supply via their battery factories, let’s not forget the 70 giga factories in the pipeline, where the frick do they think they are going to get their lithium from?
I see the world very differently in two years. Yes the extra minerals are an amazing bonus, but let’s not forget the reason we first invested. Do not underestimate the lithium factor.
Best wishes to all.
