Lithium Market Update

https://www.linkedin.com/pulse/lithium-market-update-march-2016-joe-lowry   

"The companies that rely solely on conversion of spodumene (aka “the converters”) are suffering from a lack of raw material and are all chasing Galaxy as they restart Mt Cattlin. This is great news for Galaxy as they can both charge a premium and get advance payments. Unfortunately in 2016 Galaxy is only going to have a partial year production and the shortage in China will continue as the China market will grow more than Galaxy’s total 2016 LCE output which sets the table for 2017 upside when they will have a full year of production."

"Again – no investment advice here but if you want a lithium stock, I would look to Oz and the spodumene producers. While Talison will continue to be the leading supplier, the reentry of Mt Cattlin ($GXY) into the China lithium concentrate market and start-up of Mt. Marion ($NMT) are critical elements in the next stage of global lithium supply."

"Price
The more significant spodumene becomes in the lithium supply pie chart, the higher the average cost of product going into the market will be. Many “experts” are calling for single digit lithium carbonate prices in 2017 and beyond. I am not ready to say a $20/kg price is going to be the long term global “new normal” but I am willing to say the average global price in 2020 will NOT be in single digits in any scenario absent a complete collapse of lithium demand which seems highly unlikely."