Lithium Market Shifts on Acquisitions and Promising Lithium Discoveries - Seite 3

Japanese company Toyota Tsusho has its eyes set on Australian mines, having acquired a 15% stake in Australia's Orocobre. The company is set to invest $292 million with the aim of increasing output. The deal will see Tsusho acquire sales rights for the lithium with an outlook of raising production capacity by more than 140% in the next few years.

Lithium Market Maturing

As expected, the lithium market is experiencing a maturation process that involves acquisitions, mergers and shifts among the major and minor players. The smaller players, such junior exploration companies, tend to allow demand forces to push up prices up before making a capital outlay on mining. That has been NRG Metals' strategy and it appears to be paying off.

As demand rises, the prices of lithium should strengthen further, as evidenced by a doubling of prices in the last two years. In the interest of profits arising from these price hikes, more mining companies will be incentivized to set up the enormous capital outlays required to bring more mining infrastructure online. On the demand side, lower production costs of li-ion batteries accelerate the adoption of battery-powered devices, creating a cycle of lithium demand hike.

Lithium mining companies looking to increase their interest in the South America's lithium zones include:

Sociedad Quimica y Minera de Chile S.A., (NYSE: SQM) is a producer of potassium nitrate and iodine. Its segments include specialty plant nutrients, industrial chemicals, iodine and derivatives, lithium and derivatives, potassium, and other products.

FMC (NYSE: FMC) is a Philadelphia-based chemical company that continues to ramp up its lithium production. FMC is not solely focused on lithium but this segment of its operations has been very profitable recently. FMC is planning to triple its lithium hydroxide production capacity by 2019.

Galaxy Resources (OTC: GALXF) is a lithium-focused resources company with assets spanning Australia, Canada and Argentina. Galaxy is currently advancing plans to develop the Sal de Vida Lithium and Potash Brine Project ("Sal de Vida") in Argentina.

For a more in-depth look into NGZ and the shifts in the lithium space you see the article at USA News Group: http://usanewsgroup.com/2018/03/12/analysts-predict-lithium-sector-is-growing-faster-than-any-other-sector-in-the-past-decade/

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USA News Group

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