How did top ASX-listed lithium stocks perform in August?

Highlights

Most lithium mining stocks have risen by triple-digit percentages in the last couple of years or so.

The ASX 200 Materials index was 1.75% up at 15,375.90 points today at 2.44 PM AEST.

Many lithium companies’ stocks like Sayona, Core Lithium and Piedmont shares were also trading in green today.

Lithium is currently in high demand because it is used in the production of batteries, which are used in electric vehicles (EVs). There is no denying the fact that the demand for EVs has risen significantly in the last couple of years and this is one of the main reason why investors are bullish about companies that supply lithium.

It is interesting to note that though lithium is a common substance, its costs increased 400% in 2021 and have continued to grow thus far in 2022, easily exceeding previous all-time highs recorded in 2017.

From well-established lithium mining firms to emerging players that have yet to generate income, most lithium mining stocks have risen by triple-digit percentages in the last couple of years.

Some estimates predict that lithium demand will more than double in the next several years due to EV battery demand and energy storage. The Infrastructure Investment and Jobs Act of the United States set aside US$5 billion in federal financing for EV charging stations to meet President Biden's aim of EVs accounting for 50% of new auto sales by 2030. With automakers on board, the demand for lithium will only increase in the coming years.

EV sale in Australia

In Australia, over 40,000 electric vehicles have been sold since 2011. According to a report published in carsguide, around 30 EVs are currently available for sale in Australia and more models are expected to be launched in the market in 2022 and after that.

The report added that as of April 2022, there were 30 EVs model with 65 versions available in Australia, this includes 28 plug-in hybrid electric vehicles (PHEVs) and 37 battery electric vehicles.

In 2021, around 6.6 million EVs were sold across the globe.

China is on top when it comes to sales of EVs, with 3.4 million EVs sold last year - more than the entire year of 2020 internationally - accounting for a stunning 53% of global EV sales in 2021.

Image Source: © Elvector | Megapixl.com

Lithium price

It's been nearly a year since lithium prices reached an all-time high and three months since a contentious Goldman Sachs research note predicted a price crash due to increased lithium supply.

Benchmark's global average lithium prices have remained stable since April's record highs, with Chinese technical and battery-grade lithium carbonate prices rising. This starkly contrasts to other battery metals, such as cobalt and nickel, which have seen price declines this year.

Since January of this year, the price of lithium carbonate, from which lithium is extracted, has risen by more than 70% to 4,76,500 Chinese yuan a tonne. It reached a record high of 5,00,000 yuan in March of this year, with a fourfold increase year-on-year.

Today (5 September) at 2.43 PM AEST, lithium prices were spotted at 4,92,500 CNY/T, a 3.36% increase on a monthly basis and around 294% on Y-o-Y basis.

In this article, we at Kalkine Media® will look at the performance of top ASX-listed lithium stocks in August.

Image Source: © 2022 Kalkine Media ®
Data Source- ASX dated 05 September 2022

Sayona Mining Ltd

The leading lithium producer Sayona Mining Ltd (ASX:SYA) has projects in Quebec, Canada and Western Australia.

The company has made significant progress toward restarting spodumene (lithium) production at its North American Lithium (NAL) operation in Québec, with about 30% of plant and equipment modifications now completed.

Sayona plans to resume production in the first quarter of 2023, making it the only indigenous supplier in North America.

In Western Australia, the company owns a sizable tenement portfolio in the Pilbara region, which is rich in gold and lithium potential. Sayona is looking for Hemistyle gold opportunities in the world-class Pilbara region, and its lithium projects have an earning arrangement with Morella Corporation.

Meanwhile, shares of Sayona were trading at AU$0.26 each, up 1.96% on ASX today at 2.26 PM AEST. In August, the company's shares jumped around 51%.

Core Lithium Ltd

Another lithium producer, Core Lithium Ltd (ASX:CXO), announced recently that it has extended the termination date for its contractual offtake term agreement with Tesla to 26 October 2022.

The prolongation gives Core and Tesla more time to finalise negotiations for the official full-form enforceable offtake agreement.

Notably, the offtake term sheet with Tesla is for supplying up to 110,000 dry metric tonnes of lithium spodumene concentrate generated at Core's Finnis Lithium Project, which is set to begin production in 2023.

Meanwhile, shares of Core Lithium were spotted trading at AU$1.36 per share, up 5.45% on ASX today at 2.27 PM AEST. The company provided around 21% returns to its customers in August alone.

Piedmont Lithium

Piedmont Lithium Inc (ASX: PLL) is building a multi-asset, integrated lithium business to support the transition to a net-zero society and develop a sustainable energy economy in North America.

The company revealed on Friday (September 2) the location of its proposed 30,000 metric tons per year LHP-2 lithium hydroxide plant in Etowah, Tennessee, in McMinn County. Piedmont thinks Tennessee Lithium will be the largest lithium hydroxide processing facility built in the United States when it is completed and begins production in 2025.

Piedmont's Tennessee Lithium project will be among the first to use the breakthrough Metso: Outotec technology to build lithium hydroxide plants. This technique eliminates spodumene acid leaching and sodium sulfate waste, making Tennessee Lithium one of the world's most sustainable lithium hydroxide businesses.

Data Source- Company announcement dated 02 September 2022

Meanwhile, shares of Piedmont were trading at AU$0.85 apiece, up 2.10% on ASX today at 3.32 PM AEST. The company has provided around 41% returns to its customers in August month alone.