As US regulators zero in on Chinese-owned TikTok and Gen Zers start sipping on Lemon8, Biden’s team may have bigger battles on the horizon. 🍋
China’s cooled their jets ending military ‘drills’ around Taiwan, but are they gunning for global lithium dominance? While the US led the world’s lithium production in the 90s, today, Australia, Chile and China produce 90% of the ‘white gold’ that powers our phones, laptops and EVs. And collectively China’s global mining interests - including with ‘mineral rich’ African nations like Zimbabwe - may be inching towards locking down the lithium supply chain hoping to host 60% of the world’s lithium refining. 🏭
Playing catch up, in 2022 Biden set out to clean up the US with his Inflation Reduction Act, issuing US$2.8 billion of grants, including for the EV supply chain. But as lithium companies dig deeper to meet demand in an industry projected to be worth US$22.6 billion by 2030, there have been sector-wide allegations of worker slavery and unethical practices. So as the world powers up ‘clean’ tech, are we facing a carbon-dioxide-emitting, water-consuming lithium paradox? 💧
Early this year, Lithium Americas (LAC) broke ground on Thacker Pass in Nevada - hailed the world’s ‘the third largest’ lithium source - with General Motors (GM) committing to invest up to US$650 million for exclusivity. Despite Indigenous sacred land pleas in court, and opponents saying mining will decimate ‘delicate’ ecosystems, production is forging ahead. 🌱 Following the news, the company's stock climbed 10.6% YTD (year-to-date).
Recipient of US government US$141.7 million, Piedmont Lithium (PLL) has seen their stock jump 24% YTD after announcing they’re building the largest lithium hydroxide plant in Tennessee - the compound used by Tesla credited with safer, longer battery life. 🔋
Some producers may share Biden’s green goals, however. For the third year running, Livent (LTHM) gained a Gold sustainability rating for their social and environmental efforts, news that may have contributed to their YTD share price lift 13.6%. And Brazil’s Sigma Lithium (SGML) announced building a greentech dense media separation production plant, seeing their shares jump 45.4% YTD. Little wonder that the Global X Lithium & Battery Tech ETF (LIT) is up nearly 8% YTD - nudging ahead of the S&P 500 (VOO) at 7.5% YTD. Easter may have come and gone, but seems battery-making bunnies keep going and going. 🥁