There has not been a lot of good news in the Lithium sector as most Lithium stocks have been hammered lately. This is driven by the perception of oversupply in the market. This is short term. As all commodities are cyclical, this will turn. Maybe not so dramatically, but many are forecasting this to be in the third Q to end of the year – maybe even a bit longer. Time will tell, but I think it we will see an upswing Oct to Dec to Q1 next year.
But to the Seeking Alpha article attached..........Good article that highly notes an ASX company, PLL, Piedmont, but my takeaway on this is as follows:
No question on the EV revolution. All indicators project huge growth potential worldwide. People post articles all the time about this to reassure themselves, but at this point, I see this as a given. Thus, the demand for Lithium and growth potential is huge. There is plenty of Lithium in the world, so no problem there. Much of the demand will be met by the world's top 4 producers, but they will not supply it all. Many more projects will have to come on line to meet the demand but not all the projects will be developed due to lack of attractiveness, funding, whatever.
This SA article only mentions three development projects in the US to meet the supply of the designated "critical mineral" Lithium in the US: Piedmont, Thacker Pass and Clayton Valley. There are other development projects in the US that this article fails to mention, but perhaps that they are not as attractive or too early stage. So, just to focus on the three that the author mentions.
Lithium production in the world currently comes from either brine deposits or hard rock – spodumene. There are some good examples of HR in Australia – PLS, KDR, others. They will be very successful. In the US market, however, of the three that are mentioned here, 2 are clay type deposits. There have never been any lithium clay deposits developed in the world to date and although no doubt it can be done, there is greater uncertainty with clay deposits, not tried and true. On the other hand, Piedmont is developing a tried and true spodumene deposit in North Carolina. A deposit that really needs no testing to prove up, but nevertheless, must still be done to comply with JORC. (This deposit was the only source of Lithium in the world for decades.) IMO, PLL is the best opportunity for a Lithium project in the US. IMO, good timing for PLL with revamped SS due in September, permitting and then PFS due in Q1 during this period.
Nemanska is a good spodumene project being developed in Canada. (TSX listed) In fact, they received funding this summer, but despite this, their SP has also been hammered due to the market. They will be successful and will no doubt feed Lithium to the US, but still is not US home grown Lithium. IMO, PLL will be lower cost for many reasons and has much greater LT potential. I just see no drawbacks for PLL, and think it will be perfectly positioned to enter production the US at the right time and feed Lithium into the US market when it is needed most. It is the best development play in the US - IMO.
Interest in this stock is lacking, but I think this will change significantly over the next 7 months. PLL - ASX company in the US IMO
