Pilbara accepts a pre-auction bid of $1200/ton. Yahua Group has locked in lithium concentrate twice in two days

SMM News on March 15th: In recent days, there have been frequent news from lithium mines at home and abroad. Pilbara Minerals, a well-known Australian lithium mining company known as the "lithium price indicator," announced that it will hold an auction for spodumene concentrate again after more than a year, with a quantity of about 5000 tons, and the auction will be held on March 18. The starting price has not been determined. However, according to the latest news on March 14, Pilbara announced that it has received offers from multiple buyers before the start of the spodumene concentrate auction on March 18. The company has already accepted a bid of 1106 US dollars/ton (CIF China) for a 5.5% grade spodumene concentrate from one of the buyers. Taking into account the lithium content and freight costs, this offer is equivalent to a standardized 6% grade spodumene concentrate (CIF China) at $1200/ton. According to SMM spot prices, as of March 15, the spodumene concentrate (CIF China) index spot price is temporarily stable at $1045/ton.

However, considering Pilbara's current purchase agreements with other companies, it is expected that this batch of goods will be delivered in the quarter of December 2024. And due to the many long-term purchase customers this year, it is difficult for the company to conduct regular spot sales through the BMX auction platform. According to SMM research, the pre-sale price of $1200/ton SC6% before the auction of the Australian mine Pilbara on March 14 is lower than the expectations of some lithium salt companies, which to a certain extent affects short-term spot sentiment. However, from a long-term perspective, due to the consideration of market oversupply this year, the transaction price of the lithium mine corresponds to the lithium salt cost is higher than the price forecast for lithium salt in December of some market participants. It is worth mentioning that in the shareholder's investigation in early March, Yahua Group was also asked about the recent production and sales of lithium salt. The company stated that the recent production and sales of lithium salt products have been good, and the company has long-term orders from domestic and foreign leading companies such as Tesla, CATL, and LG Chem. At the same time, it has seized the opportunity for the lithium industry to stabilize. In January, the production and sales of lithium salt products increased by 161% and 627% year-on-year, achieving significant results in production and operation and economic benefits. Public information shows that Yahua Group mainly engages in the research, production, and sales of lithium hydroxide, with a comprehensive lithium salt production capacity of 73,000 tons. In response to the advancement of the Kamativi lithium mine project in Zimbabwe, Yahua Group stated that Phase I of the Kamativi lithium mine project has now started production, processing 300,000 tons of lithium ore per year, and the first batch of lithium concentrate has been shipped back to China. Phase II construction is currently progressing as planned and is expected to be completed and put into production within the year, processing approximately 2 million tons of lithium ore per year. After the completion of Phase I and II projects, it will produce approximately 350,000 tons of lithium concentrate. With the operation of the first and second phases of the lithium mine, the company's lithium ore procurement model will change from external procurement to self-sufficiency + external procurement mode, which will greatly alleviate the cost pressure of lithium salt. It is worth mentioning that the spot price of battery-grade lithium hydroxide has been steadily increasing since February 27, with some leading smelters based on strong bullish sentiment for battery-grade lithium hydroxide. As of March 15, the spot price of battery-grade lithium hydroxide (coarse particles) is temporarily stable at 95,500 to 100,500 yuan/ton, with an average price of 98,000 yuan/ton, an increase of 12,950 yuan/ton from February 26, a 15.23% increase.