Wednesday, June 20, 2012

"iPad boom strains lithium supplies as prices triple" (SQM; LIT)

Butch Cassidy: Kid, the next time I say, "Let's go someplace like Bolivia,"
let's go someplace like Bolivia.
- Butch Cassidy & the Sundance Kid (1969)

We have a lot of posts on the magic metal, links below.
From Bloomberg via FuturesMag:
Investors from JPMorgan Chase & Co. to BlackRock Inc. are trying to make money from the exploding popularity of iPads and increasing sales of hybrid cars by investing in producers of lithium for batteries.
Prices for the conductive metal, the lightest in the periodic table, have tripled since 2000 in a market now worth $1 billion a year as uses expand in vehicles, ceramics, electronics and lubricants. Apple Inc. and Toyota Motor Corp., maker of the Prius electric-gasoline car, have few alternatives as they pursue higher performance and mobility, leading Dahlman Rose & Co. analysts to forecast lithium demand will double by 2020.

Talison Lithium Ltd., whose shares have gained 22 percent in the last month, together with Soc. Quimica & Minera de Chile SA, Rockwood Holdings Inc. and FMC Corp., account for almost 95 percent of world supply. Rio Tinto Group, the third-biggest mining company, may join the largest suppliers if it goes ahead with a mine in Serbia it says is capable of producing 20 percent of global output of the metal.

“There are some companies now that we think are attractive to get a hold of lithium exposure,” Evy Hambro, who manages about $13 billion in mining stocks for BlackRock in London, said in an interview. “We’ve got a small exposure today and we’re looking for some more,” he said without naming any companies.

Demand for lithium-ion rechargeable batteries out of Asia has helped prices climb threefold in the last 12 years, London- based Roskill Information Services Ltd. analyst Robert Baylis said. Global use doubled from 2000 to 2011 according to Roskill, which has recently consulted on six lithium projects.

Lithium Oligopoly
The advantage of lithium-ion over other battery types is that a typical cell can generate more electricity than competing cells such as lead-acid. There is about 1.7 grams (0.6 ounce) of lithium carbonate equivalent in a mobile phone, 2.1 grams in a smart phone and 20 grams in a tablet, according to Dahlman Rose.

There will be a “step change” in the global lithium industry in 2016 or 2017 when electric cars became more commonplace, Rockwood Chief Executive Officer Seifollah Ghasemi said. Hybrid electric vehicles that are fitted with a lithium- ion battery contain about 1.3 kilograms (2.9 pounds) of the material, plug-in hybrid electric vehicles have about 12.8 kilograms, while an electric vehicle uses about 19.2 kilograms....MORE
Lithium-Ion Batteries and Bolivian Politics
Electric Vehicles-Lithium Supplies and Crucifixion in Bolivia
Lithium: In Bolivia, Untapped Bounty Meets Nationalism
France's Bollore opens talks over Bolivia's lithium (BOLL: Paris)
Lithium for 4.8 Billion Electric Cars Lets Bolivia Upset Market (SQM; BOLL: Paris)
Japanese industry set for a lithium rush (SQM)
 "With Aid to Bolivia, Japan Locks in Lithium" ooops "Bolivia slams Japan mining firm for 'plundering' resources" (PKX)
Mining lithium from geothermal 'lemonade'. And: Batteries That Don't Blow Up
A Look at the Global X Lithium ETF (LIT)
Fund Holdings of Global X Lithium ETF (LIT)
The rush for lithium is just beginning
The lithium boom is coming: The new bubble? (SQM)
Can't Get Enough o' That Lithium. "Peak Lithium: Will Supply Fears Drive Alternative Batteries?"
Although Lilly introduced Prozac to the U.S. in 1988, they didn't really begin marketing it until 1991. Sales increased five-fold by 1994, the year the big bull market of the nineties kicked in.
The joke on trading desks was that this was the Prozac market, sort of the "What me worry?" approach to equities (which may explain the Nasdaq at 5048 in March, 2000).*
This excursion down SSRI lane was triggered by the thought "If we run out of lithium, what will the bi-polars do?".
*Cramer had similar thoughts, relayed in this NYT article from 2002:
...''My own view is that one reason the investor class, including me, missed the downside was serotonin,'' James J. Cramer, a former hedge fund manager and author of ''Confessions of a Street Addict'' (Simon & Schuster, 2002), said, referring to a substance in the brain that antidepression drugs augment. ''Prozac and all those other drugs banish the 'this is the end of the world' thoughts,'' Mr. Cramer explained. ''Which means you are not as anxious as you should be about an obvious down side.''...
And many,many more.
Use the Search Blog box if interested.