Shake-Ups and Shakedowns in Lithium Land

By Glenn Dyer | More Articles by Glenn Dyer

Today through Friday will be report card time for some of Australia’s major lithium companies with attention returning to the sector after Chile’s shock news late last week to take greater control of the country’s huge lithium sector (see earlier story).

Four of Australia’s lithium majors – Mineral Resources, Pilbara Minerals, Liontown and IGO – update the market this week with March quarterly reports and investors will be looking hard at their numbers and the impact of the collapse in world lithium prices on their finances.

As well, their views on the move by Chile to try and take greater control – partial nationalisation if you like – of the world’s second biggest lithium industry and largest reserves – will be sought by analysts who think all three could be impacted by the move in Chile.

Pilbara Minerals, Australia’s biggest lithium producer, releases its March quarterly report on today (Wednesday), as does Mineral Resources while IGO and Liontown release their figures Friday morning.

All have scheduled analyst conference calls after the reports are released.

On Monday, Pilbara Minerals shares bucked a weaker sector with a 5.2% gain while Mineral Resources shares were up 2.1% and shares in IGO were up 1%. Liontown Resources shares closed unchanged on Monday.

Chinese prices for battery grade lithium are down by around 50% to 65%, depending on the reporting agency and over 70% for industrial grade, though Monday saw the first rise in the price of industrial grade metal this year and the price of battery grade material was steady for a third day at 180,000 Yuan (according to the MySteel website) or around $US26,000 a tonne. That’s less than a third of the price at its peak last November of 575,000 Yuan or just over $US82,000.

That should make a mess of the quarterly revenue figures from all three – especially the huge Greenbushes mine in southwestern WA where IGO and its Chinese partner, Tanqi control operations, along with Albemarle, with Mineral Resources being relegated to the sidelines by Albemarle, its erstwhile partner.

In 2021, Tianqi Lithium Corporation (51%) and IGO Limited (49%) incorporated a new Joint Venture (JV), with a focus on developing and operating world class lithium assets.

The JV is currently focused on its lithium assets in Western Australia which comprise of a 51% stake in the Greenbushes Lithium Mine (49% owned by Albermarle Corporation) and 100% ownership of the Kwinana Lithium Hydroxide Refinery. Albemarle is building its own refinery nearby at Kemerton.

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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