Chinese hungry for Aussie spodumene

PILBARA Minerals boss Ken Brinsden says Australian companies will be best-placed to take advantage of China’s insatiable demand for lithium.
Chinese hungry for Aussie spodumene Chinese hungry for Aussie spodumene Chinese hungry for Aussie spodumene Chinese hungry for Aussie spodumene Chinese hungry for Aussie spodumene

Ken Brinsden.

Kristie Batten

Brinsden said China was heavily reliant on imported spodumene – more so than brine – to supply its rapidly growing electric vehicle industry.

“People talk about brine like brine is some sort of magic bullet – China is the main game,” he told MNN.

“It’s the world’s largest supplier of lithium raw materials but they don’t consume much brine. The industry is almost solely focused on hard rock sources of supply.”

In 2015, China imported 72,000 tonnes of lithium carbonate equivalent (LCE), of which 55,000t comprised spodumene and only 6000t of which was brine.

The Chinese are investing heavily in chemical conversion capacity to convert spodumene to lithium hydroxide and carbonate.

Brinsden said there was a misconception that hard rock producers were high cost.

“You might think that – the Chinese don’t,” he said.

Levelling the playing field further is a recent development in Chile.

Earlier this month, Albemarle reached agreement with the Chilean government on a new “progressive commission” on every tonne of LCE exported.

The commission, or royalty, will be applied on a sliding scale, depending on the LCE sales price.

Brinsden said any advantage Albemarle had over hard rock producers had diminished.

“They’re a significant exporter and they’re planning to grow a lot more, but it’s not going to be low-cost anymore, I don’t think, because that’s quite an impost,” he said.

“It’s a big deal and nobody’s really talked about it yet.”

Brinsden said it was China’s appetite for spodumene that had slightly delayed the financing for the $A214 million Pilgangoora mine.

“Our opportunity is in the alignment of offtake and how it relates to the financing of the project,” he said.

But Brinsden remains confident the financing will be in place by the end of this quarter.

“It’s important to us because we want to be able to continue momentum with the project, and the longer it drags out, the harder it is to maintain that momentum,” he said.

“I’m reasonably comfortable as to where we’ve got to now that we can achieve those timelines.”

Pilbara is targeting commissioning late this year for first concentrate production early next year.

Shares in Pilbara rose by 0.3% this morning to 56.7c, capitalising the company at more than $715 million.