It's Buying Time Now

Source: Barry Dawes 01/24/2024

Barry Dawes of Martin Place Securities shares his analysis on the current state of lithium to explain why he believes now is the time to buy lithium stocks.

The disparity between the current lithium product prices and the current and projected costs of production of future capacity is unsustainable.

Lithium stocks globally have been trashed but it is supply and demand that are important, particularly for spodumene.

China and Europe are the key markets for lithium — certainly, for EVs.

EV demand is being driven by China (8.35mpa units – 65% of EV sales) and Europe (3.1m pa units – 24% of EV sales) which is almost 90% of global demand.

And also for lithium.

China produces 66% of refined lithium, but Europe produces just 1%.

China produces 66% of lithium products but mines only 10% of primary lithium.

And from ores with less than 20% being spodumene the rest being brines and from lithium micas.

Europe produces none.

A big mismatch here, so spodumene from WA is very important.

The lithium price looks as if it might be bottoming at previous highs.

First price uptick in a long while!

Lithium ETF oversold and could be bottoming, too.

ASX lithium stocks have fallen disastrously but are now bottoming.

It is buying time now, especially better placed explorers where the timeline to discovery is short.

Head the markets, not the commentators.

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