2022 Lithium Mine "battle" is hot! These nine enterprises seize the first opportunity at the beginning of the year [attention]

SMM Feb. 11: 2021 is the year of the outbreak of lithium-related products, and this situation has not been able to get any respite after 2022. Under the background that the supply of lithium resources exceeds the demand, and the field of new energy vehicles is still booming, the prices of lithium carbonate and lithium hydroxide, the main raw materials of power batteries, are rising all the way. SMM spot prices show that since the beginning of 2022 alone, the average spot price of domestic battery-grade lithium carbonate has risen to 392000 yuan / ton, up 41.01% from the beginning of the year.

"Click to view the spot historical price of SMM new energy products.

Therefore, many enterprises have joined the ranks of "ore grabbing". Since the beginning of the year, many companies have successively carried out the layout of lithium ore resources, including LG Energy, BYD, Yabao, Zijin Mining, Ganfeng Lithium Industry, Zangge Mining and so on. Specifically:

LG Energy signs a big deal with Australian lithium miners to strive for the top spot in the global battery industry.

Australian lithium miner Liontown Resources Ltd said on January 12th that it signed a five-year off-take agreement with LG Energy to purchase 100000 dry tons (DMT, 's moisture-deducted weight) of spodumene concentrate from Liontown's Kathleen Valley project in the first year starting in 2024 and increase to 150000 dry tons per year in subsequent years.

BYD subsidiary won the bid for 80,000 tons of lithium mining contract in Chile, which will have 20 years to produce lithium salt in the next 20 years.

On the same day, BYD and Servicios y Operaciones Mineras del Norte each won 80, 000 tons of lithium in a tender launched by Chile's Ministry of Mines in October. According to the previous provisions of the Chilean tender, the winning bidder will be given a period of seven years of survey, research and project development, which can be extended by up to two years, followed by another 20 years to produce lithium salt. But just two days later, the intellectual court suspended two previously awarded lithium production contracts.

Rio Tinto announced that the start-up date of Serbia's lithium mine will be postponed by one year to 2027.

On January 18, multinational mining giant Rio Tinto postponed the first output of the Serbian lithium project by a year to 2027 in its fourth-quarter production results. On the same day, Allkem also said that due to the impact of the epidemic and delays in project approval, the first production time of the first phase of the SaldeVida project is expected to be postponed to the second half of 2023.

Serbia announces complete suspension of Rio Tinto lithium project! Europe's largest lithium mine is planned to be stillborn.

On January 20th, at the urging of environmentalists, Serbia vetoed Rio Tinto's Jadar lithium project and revoked all Rio Tinto's decisions and licenses related to the lithium project. However, the Serbian prime minister did not answer the question of whether the government would allow lithium mining in the future. Rio Tinto subsequently issued a statement saying it had been abiding by Serbian law. "Rio is reviewing the legal basis for this decision and its impact on our business activities and employees in Serbia."

Clean Lithium developer LKE confirms to increase the Kage Lithium Mine Project to 50, 000 tons of Lithium Carbonate equivalent per year

Meanwhile, on January 19th, Clean Lithium developer Lake Resources NL ((LKE) confirmed that the base production in the final feasibility study and final investment decision for the Kachi (Kachi) lithium mine would be increased to 50, 000 tons of lithium carbonate equivalent per year. As the drilling results are expected to improve resource estimates, the final feasibility study will increase the annual production of lithium carbonate equivalent from 25500 tons to 50000 tons.

Zijin Mining completes acquisition of 100% stake in New Lithium Company

On January 27, Zijin Mining announced that the relevant procedures for the acquisition of the new lithium company had been completed, and the environmental assessment permit for the first phase of the 3Q project had been approved. According to the feasibility study scheme, the first phase of the project will be designed to produce 20,000 tons of battery-grade lithium carbonate per year, which is expected to be completed and put into production by the end of 2023.

In early February, Zijin Mining invested another $380 million through its local subsidiary Liex to build a lithium carbonate plant in Argentina. The Argentine government said the plant, which will be located at the Tres Quebradas project in Catamarca in the north, aims to produce 20, 000 tonnes of lithium carbonate a year and hopes to double its production in the medium term. Construction of the plant will begin this year and production will begin by the end of 2023.

China Mineral Resources plans to acquire Bikita Lithium Ore Equity Beneficiation capacity of 700000 tons per year for US $180 million

On the evening of February 8th, rare Hong Kong, a wholly-owned subsidiary of China Mineral Resources, acquired the 100% equity interest held by AMMS and SAMM at a benchmark consideration of US $180 million in cash.) 100% equity interest held by AMMS and SAMM (hereinafter referred to as "Afmin") and 2 Amzim Minerals Ltd ((hereinafter referred to as "Amzim") 100% stake in the transaction. The underlying Afmin and Amzim hold a combined 74% interest in Bikita. Bikita's main asset is the Bikita lithium project in Zimbabwe, with a mineral processing capacity of 700000 tons per year.

Tibetan Mining and Super Resources cooperate on Laguna Verde Salt Lake Lithium Project in Argentina

After trading on February 9, Zangge Mining Co., Ltd. carried out investment cooperation with Argentina's Laguna Verde Salt Lake Lithium Project, which is 100% owned by Super Resources. Super Resources owns 100% of the lithium mining rights in Laguna Verde Salt Lake in the Argentine province of Catamarca, which is located in the core of Argentina's famous salt lake resource-rich lithium triangle. At present, exploration of the salt lake has been carried out and is expected to be completed in May 2022.

Yabao joins hands with Mineral Resources to expand Lithium Mine Business

On February 10th, Yabao of the United States said that it had a relationship with Mineral Resources Ltd.. A non-binding agreement has been signed to form a new joint venture that will seek to own more lithium mining assets outside Australia, of which Arbor of the US will operate.

While a number of enterprises are scrambling to lay out lithium mines, the proposal for nationalization of Chilean lithium mines is also affecting the hearts of people in the industry. Now, this proposal has been tentatively adopted, and SMM in the "preliminary adoption of the Chilean resources nationalization proposal will affect the supply pattern of China's lithium market?" In the article [SMM Analysis], the impact of this news on the supply pattern of China's lithium market is described in detail. SMM believes that for domestic companies with shortage of lithium resources, this will increase the difficulty and cost of binding to high-quality resources in Chile.

On February 7, Tianqi Lithium Industry also issued a response to this news, saying that the nationalization of lithium mines in Chile has not yet actually landed. Previously, the company has signed a contract with the local government and has been granted a lithium resource quota until December 31, 2030, which will not be changed.

However, judging from the circumstances in which the Chilean court ordered the suspension of the BYD contract, it is expected that Chinese enterprises will also face many difficulties in the development of quota resources in the future, and the nationalization of overseas resources will enhance the pricing power of local resources. to give it a greater say and control over the benefits of resources. According to statistics, 78% of China's imports of lithium from salt lakes in 2021 will come from Chile, so the cost of importing lithium products by Chinese enterprises may be constrained in the future.

The supply and demand pattern of lithium resources in China is changeable. Where will the lithium price go in the future?

According to SMM estimates, China's lithium carbonate market will be difficult to balance in the next five years. China's lithium carbonate supply is limited by overseas resource capacity from 2021 to 2022, and there will be a supply shortfall of about 7 per cent in 2022, with annual average prices rising sharply. With the gradual strengthening of overseas resource control, China's resource supply will also face risks and challenges in the future. "View details

According to Ping an Securities, global lithium demand is expected to increase from 480000 tons in 2021 to 1.48 million tons in 2025, with a compound annual growth rate of 32 per cent. China's lithium demand will increase from 230000 tons in 2021 to 670000 tons in 2025, with a compound annual growth rate of 30 per cent.

Guoxin Securities believes that the current supply and demand of lithium ore and lithium salt is still in the most tense moment. On the supply side, the output of lithium extraction from Qinghai Salt Lake will decline in winter; on the demand side, the production and sales of domestic new energy vehicles continue to exceed expectations, driving the release of production and sales of cathode materials, especially the production of lithium iron phosphate remains strong. It is expected that the supply and demand of lithium ore and lithium salt is still in the most tense moment, the tight situation of global supply and demand of lithium ore is difficult to ease in the short term, and lithium price is expected to remain high.