Lithium market surpluses continued to suppress costs and hinder sector development all through Q3 2024, broad consolidation early within the quarter signaled a possible bottoming out.
Subsequently analysts forecasted a value restoration as EV gross sales exceeded expectations in September.
Projected demand development prompted Sprott Insights to warn of a possible lithium scarcity rising as early as 2025, with demand, particularly from China, set to rise 20 p.c yearly.
Jacob White, an analyst at Sprott Insights, pointed to the longer term demand developments as a catalyst for lithium market funding.
“The lithium battery business is projected to create US$400 billion in annual income alternatives worldwide,” he wrote. “The lithium manufacturing element of the chain has recorded margins as excessive as 65 p.c, doubtlessly making it a extremely worthwhile sector.”
White continued, “Lithium miners, particularly, could also be properly positioned as they may give leverage to rebounding lithium costs. In distinction, non-vertically built-in lithium processing/refining corporations might even see their bills rise.”
The listing beneath was generated utilizing TradingView’s stock screener, and information was gathered on October 18, 2024. Whereas US lithium corporations had been thought-about for the listing, none had been up year-to-date on the time information was gathered. All lithium shares had market caps above $10 million of their respective currencies when information was gathered.
1. Q2 Metals (TSXV:QTWO)
Year-to-date achieve: 408 p.c
Market cap: C$174.5 million
Share value: C$1.27
Exploration agency Q2 Metals is exploring its flagship Mia lithium property within the Eeyou Istchee James Bay area of Québec, Canada. The property comprises the Mia development, which spans over 10 kilometers. Additionally included in Q2 Metals’ portfolio is the Stellar lithium property, comprised of 77 claims and situated 6 kilometers north of the Mia property.
This yr, Q2 Metals has additionally targeted on exploring the Cisco lithium property, which is located in the identical area. On February 29, the corporate entered into three separate option agreements to achieve a one hundred pc curiosity in Cisco, information that brought about its share value to skyrocket; it reached a year-to-date excessive of C$0.54 on March 4. Q2 Metals closed the acquisition of Cisco in June and now wholly owns the undertaking.
In mid-Might, Q2 Metals launched re-assayed outcomes from 2023 drilling performed at Cisco by the property’s distributors. The corporate used the analytical technique it has utilized to its Mia drill cores.
“We’re happy with the constructive end result of the re-analysis of the Cisco drill outcomes,” said Q2 Metals Vice President of Exploration Neil McCallum. “A radical evaluation of the standard management measures has solidified that the brand new outcomes are extra correct than the unique outcomes beforehand introduced. It’s not an surprising change because the analytical strategies now used are extra correct at larger grades above roughly 1.5 p.c Li2O and now we have a number of samples above that vary.”
Later that month, the corporate announced the start of a summer season drill program on the Cisco property. It has since launched a number of vital updates, together with the affirmation of eight new mineralized zones on July 8.
Firm shares rose to a year-to-date excessive of C$1.48 on October 10, shortly after Q2 released drill outcomes and core assays from the Cisco property. As of October 1, 17 holes masking 6,360 meters in complete have been drilled.
Moreover, every drill gap encountered pegmatite with seen indicators of spodumene mineralization, a key lithium-bearing mineral.
“These assays proceed to validate the potential and scale of the Cisco Property as that of a bigger mineralized system,” mentioned Neil McCallum, VP exploration. “One necessary statement of those outcomes is the higher-grade nature of the bigger mineralized system as we take a look at and monitor the system progressing to the south.”
On the company aspect, Q2 announced a C$7.5 million personal placement on July 10. The location, which was divided into two tranches, was efficiently closed on August 9, 2024.
2. Volt Lithium (TSXV:VLT)
Yr-to-date achieve: 78.26 p.c
Market cap: C$57.44 million
Share value: C$0.41
Volt Lithium is a lithium growth and know-how firm aiming to turn into a premier North American lithium producer using its distinctive know-how to extract lithium from oilfield brine.
Shares of Volt reached a year-to-date excessive of C$0.49 on September 26.
On April 29, Volt announced a strategic funding of US$1.5 million by an unnamed firm working within the Delaware Basin in West Texas. This funding is earmarked for the deployment of a area unit to supply lithium hydroxide monohydrate utilizing Volt’s proprietary direct lithium extraction know-how.
The corporate’s share value retreated within the second half of Q2, however July 17 information that Volt increased its processing capacity at its operations in Alberta, Canada, by 100 fold to 96,000 liters per day brought about its value to shoot up greater than C$0.08 throughout buying and selling that day.
An August announcement from Volt highlighted the deployment and subsequent manufacturing scale up of Volt’s DLE know-how within the Permian Basin. The sector unit has the capability to course of 200,000 liters (1,250 barrels) of oilfield brine per day on location in West Texas.
3. Lithium Chile (TSXV:LITH)
Yr-to-date achieve: 30.19 p.c
Market cap: C$140.03 million
Share value: C$0.69
South America-focused Lithium Chile owns a number of lithium land packages in Chile and Argentina. Presently, the explorer is working to delineate the deposit at its Salar de Arizaro property in Argentina.
On April 9, Lithium Chile announced a 24 percent increase within the useful resource estimate for Salar de Arizaro. The brand new complete for the undertaking is 4.12 million metric tons (MT) of lithium carbonate equal, categorized as follows: 261,000 MT within the measured class, 2.24 million MT within the indicated class and 1.62 million MT within the inferred class.
Not lengthy after, on April 18, the corporate reported the creation of two wholly owned Canadian subsidiaries — Lithium Chile 2.0 and Kairos Gold — as a part of a spinout to separate its Chilean and Argentinian property.
Lithium Chile will retain its Argentinian lithium initiatives, and switch its 111,978 hectares of Chilean lithium properties to Lithium Chile 2.0 and its portfolio of gold property in Chile to Kairos Gold.
In a July operational update for the Salar de Arizaro undertaking the corporate highlighted excessive grade intercepts from gap ARGENTO-06.
1. Ioneer (ASX:INR)
Yr-to-date achieve: 73.33 p.c
Market cap: AU$572.84 million
Share value: AU$0.26
Australia-listed Ioneer owns the Rhyolite Ridge lithium-boron undertaking in Nevada, US. The undertaking is taken into account the “sole lithium-boron deposit in North America.”
As a part of the allowing course of for the Rhyolite Ridge undertaking, Ioneer completed and submitted the executive draft environmental influence assertion (EIS) to the US Bureau of Land Administration (BLM) in mid-January. In mid-September, Ioneer announced that the BLM revealed the ultimate EIS, shifting the corporate nearer to constructing its Rhyolite Ridge lithium-boron undertaking.
In accordance with the corporate, the milestone now makes Rhyolite Ridge the primary lithium undertaking beneath the Biden Administration to succeed in the superior stage of the environmental allowing course of.
“Since Ioneer’s work at Rhyolite Ridge started in 2016, now we have listened to members of the group and tailored our plans to maximise the undertaking’s many financial advantages whereas minimizing oblique impacts to the group and setting. Rhyolite Ridge is stronger due to the intensive collaboration and enter from all concerned stakeholders,” mentioned Bernard Rowe, managing director at Ioneer.
2. Vulcan Power Assets (ASX:VUL)
Yr-to-date achieve: 63.45 p.c
Market cap: AU$920.24 million
Share value: AU$4.74
Europe-focused Vulcan Power Assets goals to assist a carbon-neutral future by producing lithium and renewable power from geothermal brine. The corporate is at the moment creating the Zero Carbon lithium undertaking in Germany’s Higher Rhine Valley. Vulcan is utilising a proprietary alumina-based adsorbent-type direct lithium extraction course of to supply lithium with an finish aim of supplying sustainable lithium for the European EV market.
On April 11, Vulcan announced the commencement of lithium chloride manufacturing at its lithium extraction optimisation plant in Germany. In accordance with the corporate, the milestone marks the primary lithium chemical manufacturing in Europe utilizing native provide. The plant constantly exhibited over 90 p.c lithium extraction effectivity.
Vulcan will now put together the 40 million euro facility for business manufacturing. The corporate already has binding lithium offtake agreements in place with main automakers and battery producers, and expects to provide sufficient lithium for 500,000 EVs through the first section of manufacturing.
Throughout the third quarter, Vulcan received its first licenses for lithium and geothermal exploration in Alsace, France. The permits cowl 463 sq. kilometres, increasing Vulcan’s complete licensed space within the Higher Rhine Valley to 2,234 sq. kilometres throughout France and Germany.
In early August, Vulcan started commissioning its downstream lithium hydroxide optimisation plant (CLEOP) close to Frankfurt.
“Within the coming months, Vulcan will start to move the primary LiCl parcels from our upstream facility by means of to CLEOP for manufacturing of the primary battery-grade lithium hydroxide merchandise in Europe, all from a European lithium useful resource,” Vulcan CEO and Managing Director Cris Moreno mentioned.
A mid-October launch from Vulcan outlined a memorandum of understanding with industrial software program designer AVEVA. The partnership will see AVEVA construct a digital framework for Vulcan’s Zero Carbon lithium undertaking.
3. Cygnus (ASX:CY5)
Yr-to-date achieve: 3.7 p.c
Market cap: AU$53.17 million
Share value: AU$0.14
Cygnus Metals is an exploration firm targeted on advancing its Pontax, Auclair and Sakami lithium initiatives within the Eeyou Istchee James Bay lithium district of Québec, Canada. The corporate additionally owns uncommon earth aspect, lithium and base steel initiatives in Western Australia.
In July, Cygnus reported the completion of geophysical survey work on the Auclair lithium undertaking. The ensuing information “recognized vital potential for development” within the Pegasus zone.
Most not too long ago, Cygnus entered into an agreement to a merger of equals with Canadian copper firm Doré Copper Mining (TSXV:DCMC,OTCQB:DRCMF), which owns a number of copper property in Québec. The assertion says the merger creates “a Québec-focused important minerals explorer and developer with high-grade copper and lithium assets.”
“By combining the confirmed exploration and administration abilities of the Cygnus crew with the high-grade copper assets and immense upside potential on the Chibougamau properties, now we have the potential to unlock substantial worth,” mentioned David Southam, Cygnus’ govt chairman.
FAQs for investing in lithium
How a lot lithium is on Earth?
Whereas we do not understand how a lot complete lithium is on Earth, the US Geological Survey estimates that world reserves of lithium stand at 22 billion metric tons. Of that, 9.2 billion MT are situated in Chile, and 5.7 billion MT are in Australia.
The place is lithium mined?
Lithium is mined all through the world, however the two nations that produce essentially the most are Australia and Chile. Australia’s lithium comes from primarily hard-rock deposits, whereas Chile’s comes from lithium brines. Chile is a part of the Lithium Triangle alongside Argentina and Bolivia, though these two nations have a decrease annual output.
Rounding out the highest 5 lithium-producing nations behind Australia and Chile are China, Argentina and Brazil.
What’s lithium used for?
Lithium has many makes use of, together with the lithium-ion batteries that energy electrical automobiles, smartphones and different tech, in addition to prescribed drugs, ceramics, grease, lubricants and heat-resistant glass. Nonetheless, it’s largely the electrical car business that’s boosting demand.
How you can put money into lithium?
These seeking to get into the lithium market have many choices in the case of the best way to put money into lithium.
Lithium shares like these talked about above may very well be a superb choice for traders within the house. For those who’re seeking to diversify as an alternative of specializing in one inventory, there’s the World X Lithium & Battery Tech ETF (NYSE:LIT), an exchange-traded fund (ETF) targeted on the steel. Skilled traders also can have a look at lithium futures.
Not like many commodities, traders can’t bodily maintain lithium on account of its harmful properties.
How you can purchase lithium shares?
Via the usage of a dealer or an investing service akin to an app, traders should buy lithium shares and ETFs that match their investing outlook.
Earlier than shopping for a lithium inventory, potential traders ought to take time to analysis the businesses they’re contemplating; they need to additionally determine what number of shares shall be bought, and what value they’re prepared to pay. With many choices available on the market, it’s vital to finish due diligence earlier than making any funding selections.
It is also necessary for traders to maintain their objectives in thoughts when selecting their investing technique. There are lots of elements to contemplate when selecting a dealer, in addition to when investing apps — just a few of those embrace the dealer or app’s status, their payment construction and funding type.
Don’t neglect to observe us @INN_Resource for real-time updates!
Securities Disclosure: I, Georgia Williams, maintain no direct funding curiosity in any firm talked about on this article.
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