Mineral resources are reduced! “Lithium Triangle” Seeks Pricing Power, and Lithium’s High Price Cycle Can Extend Supplier Financial Association

© Reuters Mineral resources have been reduced! The “Lithium Triangle” seeks pricing power and the high lithium price cycle could be extended

Financial Associated Press, November 3 (Reporter Li Zijian)Whether Canada requires domestic companies to divest mineral resources in Canada, or explores the establishment of a “lithium OPEC,” key commodity-related actions in the lithium battery industry are becoming increasingly obvious and frequent. In the circumstance that upstream and pricing power control tightens, the price of lithium will again be tarnished in 2023. On the other hand, some analysts believe that the growing evolution of countries with overseas resources such as Australia and Canada to review of China’s investment and the pursuit of maximizing resource benefits in South America will slow the development process of overseas resources or lead to high levels of lithium prices are further prolonged.

On November 2, local time, for so-called national security reasons, Industry Canada requested China Mining Resources, Zangge Mining and Shengxin Lithium to divest their investments in major Canadian mining companies. For responses from the companies mentioned above, see “Are foreign lithium mines not fragrant? The impact of three Chinese companies” ordered “to withdraw from their investments in lithium mines in Canada.”

According to insiders, in fact, Canada has always conducted safety reviews of major mining investments. At present, due to the influence of international relations, the scope and boundaries of the review are indeed widening and the general situation is getting worse. at the same time, it is limited to new transactions and there is no traceability. of sex.

Under the rapid development of the lithium battery industry chain, the price of lithium as a key raw material is “increasing all boats”, “From the point of view of supplying resources, everyone is paying more and more attention to strategic resources, because the Lithium resources are relatively scarce and hot now, and countries are in the protection of New energy development is carried out on the basis of domestic supply and the guarantee of their own rights and interests. ” The person mentioned above has further analyzed.

From the point of view of the installed capacity of the global power battery, China is undoubtedly the largest consumer of lithium. According to global data on electric vehicle battery charging published by SNE Research in September 2022, domestic companies in the top ten companies occupy 6 places, accounting for more than 50% of the market.

In addition to the influence of Canadian politics, the countries of the “lithium triangle” of South America – Argentina, Bolivia and Chile are considering establishing a “lithium OPEC” to jointly fix lithium sales prices. According to data from the USGS (United States Geological Survey), the global resources of metallic lithium will be about 89 million tons in 2021 and the total resources of the “lithium triangle” will represent about 56% of the world.

Although Australia is still the world’s largest producer of lithium and Bolivia’s production is lower, the “Lithium Three” foreign ministers said Australia could also agree on the idea of ​​”price synergy” if Argentina, Chile and Bolivia agreed.

A related research report by Ping An Securities pointed out that the South American lithium triangle discussion of “Lithium OPEC” aims to exploit resource benefits, control upstream supply to control the pricing power of lithium resources and hence allocating more huge profits brought by the high lithium prices.

Some people from lithium mining companies have said that the lithium industry is a cyclical industry, after all.When the industry enters a depression, OPEC can avoid the drop in the valuation of lithium prices, which is conducive to the healthy development of the industry and the long-term stability of lithium prices.

There are also lithium ore businessmen who believe that “domestic enterprises do not realize independent control of lithium resources as soon as possible, perhaps (lithium ore) will become the next iron ore supply model.”

(edited by: Cao Jingchen)

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