I love these analysis, thank you. Deep dives into new sectors to gain some new perspectives and expand circle of competence. All knowledge is cumulative.
I really like the method you're using, where you estimate demand growth and compare it to the supply growth created by the biggest companies. One thing I will take home from this is that future demand estimates given in company presentations are not always the most realistic.
Nice. I always enjoy your miner / commodity videos. They just make so much sense. And while I was too late for the gold and copper cycles, I can now actually prepare to take advantage of this.
Thank you, Sven. I bought Livent (LTHM, now ALTM) after your video. Lithium price is still dropping but I plan to hold for a few years . Thank you for bringing it on my radar.
Sven, your videos are always great and educational, and I especially enjoy your commodities and miners videos, and in this one you really outperformed even your own high standard. It was the best "lunch and learn" video I could have picked for the day. Thank you :-)
Sven, thank you for your hard work. I noticed the drop from Lithum price and i was trying to do some research to see if its a good time to buy now. And then i see this video poping , like a gift from heaven. You literally justified my thinking. I hope you keep the good work and make our lives easier. I really plan to become a future member at your platform. I think you are one of the few guys that i really listen when i am making my investing plans. Thanks again :)
6:00 the historical reference to copper Supply/Demand projections got my sub. Great explanation and actual long-term considerations, not WallStreetBet StONks. 👍
Thank you Sven, I was waiting for it and appreciated. I am since sometimes into Pilbara and it seemed to me it is reasonably valued till the cycle picked up again in next years.
I like explorers at the moment with new discoveries that have just taken huge share price hit. The ones with great projects can develop them over the next five years as the lithium price recovers.
@6:20. As you said the forecast did not matched with the estimated value. That why margin of safety is important. We need only to put money when we see there is discount of 40-50%. As buffet used to say wait for the fat pitch. and charlie munger used to say people can make more money in waiting and be prepared to gain from asymmetricity.
Thanks for posting this Sven, it was most educational for me. My takeaway was there is far more to buying into commodities than first meets the eye. In short I do not have the ability to be confident to place a bet and my interest are best served by just saying no. Thanks for the lesson, regards Andy
Good research on how copper supply and demand forecast 10 years ago has played out. And if it is hard to predict copper demand 10 years ahead it is nearly impossible to predict lithium prices. Who knows about technology with lithium and its adoption decade ahead? And supply is a tough one too, since there are multiple sources and lithium "mining" is prone to technological changes like oil drilling by products etc.
I love SQM. They operate efficiently and structure their dividend policy really wisely. Those elephants you mentioned, one of them is actually positive, the joint venture. The other “elephant” has been a point of contention for a while, as the government has tried to nationalize the company more than once now. It’s political jargon and I don’t think that will happen. The company also just entered the West Australian market with the likes of the richest Aussie I believe. Not to mention their agriculture involvement, being close to the LatAm market. This company is so nuanced that I love how it scares popular opinion 😊
Excellent analysis and strategy! Other commodities that seem to deserve a detailed sector analysis are graphite and tungsten: they are both niche commodities whose production is almost monopolized by China, and are crucial respectively for the anode of batteries and for industrial production and defense.
I bought into Pilbara when it was 0.42 cents. Now it is one of the most shorted stocks in the ASX, It pays some dividends is well. Sven can you have a look at sodium batteries BYD is already producing cars with it. Much cheaper safer and easier to recycle it. I wonder how it will play out.
You did not touch on the lithium royalty company play (LIRC in Canada). LIRC is currently trading at some 50% of NAV (as per company presentation). It's not clear to me at what lithium price exactly the NAV is calculated, but should be the long term consensus price. Royalty companies, albeit usually more diversified then LIRC from a commodity standpoint, have much desirable added benefits when compared to the mining companies, first of all they are insulated from production cost increases, so it's quite rare that they trade at such a discount to NAV.
I admire your depth of knowledges and analytics! Now that the SQM codelco deal has been signed, do you agree that SQM stock can be sold for ~ $75 in 2027?
Sven, very nice video. The difficulty I have with Lithium or Uranium or Silver or even copper is that the cycle is very much dependent on a macro scenario, inflation, interest rates, economic growth and, in the case of Lithium, the development of new technologies. It seems very difficult to derive timing.
I think that you don't have to look too much at the macro scenario, you have to focus on what is going on with the specific commodity in question, which is oversupply and lower prices, regardless of the macro picture. When the lower price will touch the cost curve and drive some lithium producers out of the market, we will know it as it happens. If the producers with the highest cost start to go bankrupt, it will be a good entry point into the higher-quality ones, because the supply will go down and the undersupply will sooner or later lead to higher prices again, regardless of the macro picture.
yes, it depends on the macro, but my strategy is to buy it when it is so cheap that there is only upside, then the macro adjusts in a period between a week and 5 years.
Thanks for the great analysis, as always, Sven! As we talk about cyclical stocks isn't it good idea to check again ForFarmers N, Farmer Bros or JDE Peets ? They are down right now. I think a video for them (the sector) will also worth. Thank you!
Lithium is tricky. You have growing demand for EV batteries. You also have much more efficient batteries being created as well which could cut Lithium demand. If one of these alternative no lithium batteries works out, then lithium demand will crash hard. EV tech is advancing so fast that it is hard to make a good call on the materials involved.
I dont see why no lithium batteries would be better, you have to have a cheaper metal alternative then and Lithium is already very abundant and cheap so I doubt that will happen. It's also the best contender for solid state batteries.
Except for maybe Magnesium, if theres a good solid state magnesium battery coming out then yes lithium would be worthless , but this feels 20 years away
miracles for junior miners like a major producer got trouble with a mine and have to buy a better mines, that's why I will try to find magic junior for the sector that have high chance to be bought by a major.
@@Value-Investing In december 2023 Chilean People Voted against the change in national costitution, in a blow to the president (that wanted to change it to be more "socialist friendly"). 4 Months after that, the socialist president decided to nazionalize 51% the litihium mines of SQM anyway.. that was Tragicomic! :O
Very interesting. Thanks as always for your thoughts. Have you ever done an analysis of Weight Watchers? WW? They have been around for so long, and they just recently lost nearly 50% in a super short amount of time. Possibly a Value Opportunity? Just a thought. Grazi!
Muy buen análisis, como es usual en el canal, crees que el mismo potencial con el Litio pueda suceder ( o estarse creando ) con el uranio? Si el uso del automóvil eléctrico no se diera como se planea, podría afectar al mercado del Litio? Gracias por tan buena información, Saludos
Dobar dan brate (you belong to the Venice Republic as well at the end of the day)! I scored an average of 15% yield in a couple of months just watching your videos (ADM, FMC and ALTM this week) and as I'm coming to Amsterdam in May I was wondering if it's possible to return the favor inviting you for a cocktail/dinner! Thanks for your work :)
Great video Sven! Quick question, is it possible that when we take into effect the tendency of central banks to lower the interest rate in the near future as a possible catalyst for EVs demand and thus for Lithium price? As you showed, EV demand has somewhat stalled or even worse in western country because when debt is so pricy nobody wants to buy a car (and certainly not a pricy car), but when debt doesn't cost much, everybody wants a new car, the new thing (in this case, EV cars). So I guess my question is, when we take into account the cyclicality of the economy (and interest rates), is it possible that the lithium market shoots before 2030?
Hi, I was looking at encode wire. They have 0 debt, a single digit p/e ratio, but sporadic growth that may indicate they're a cyclical. Are they exuberantly priced because of the current high prices of copper ?
Dr Sven, How is it possible for Piedmont to have such a low production cost for lithium hydroxide when they have no experience and expertise in refining spodumene? They have huge plans and are currently driving Sayona broke in supplying spodumene at very low levels but a potential Spodumene supplier from Atlantic in Africa?
Thank you vey much, it was a great video. But I don't understand this: Looking at Albemarle's share price history, it had a stable period between 2011 to 2016, at around $40-$60 per share. Back then, lithium (carbonate) price was also relatively stable, around $6.000 per metric tons if I'm not mistaken. And now, after going to the moon and crashing back to Earth, lithium price is still higher than those 2011-2016 values, and most likely will remain so even with the most pessimistic scenarios, whereas Albemarle share price is now at only around 2 times of its 2011-2016 value even without adjustments. I am quite sure that since back then, this company has much more than doubled its size, its capacity, etc. So its current price just doesn't make sense. What am I missing here? Thanks a lot!
Thank you very much for your response@@Value-Investing . I agree that the costs really do matter, especially when the price is that much depressed. But, from a valuation point of view, on one hand we have Albemarle 10 years ago, with X price per share, and on the other hand we have Albemarle today, with only 2X price per share. Lithium price has increased, even after its recent ups and downs. I don't know, its current price after 10 years feels wrong, but maybe I should do more math instead of relying on the feelings. And from a cyclic commodity point of view, as you mentioned in your video, the meteoric rise of lithium prices must have given way to new projects. But now, with the current prices, most projects must have been economically unfeasible, right? When do you think we can see this effect in the supply side? I suppose big players who can survive this cycle should prevail eventually. Actually one of the things I like about Albemarle is its diversification of revenue streams, which should provide some relief during down cycles. Best Regards!
In summary, the outlook is so terrible that it might not be too bad. The prediction that it’ll be 2028 before undersupply is based on production increase forecasts that likely will not be met because the near term price will be low enough to reduce production from what it would have been. In other words, it’s entirely possible that demand exceeds supply *before* 2028 due to how badly supply is exceeding demand. *scratches head Did I get that right? TLDR: Consider buying lithium miners in 2024, but only the lowest production cost companies, and only on dips.
Wake up Sven! You told us to message you when ALB is 8B market cap range (nom book value - not tangible equity). Any thoughts? Lithium prices have also crashed.
Hi Sven, I do not think there is company without any potential issue . I guess you will never buy APPLE of Microsoft several years ago :) ALTM get another hit today so market cap is now 5.5 B after merge so in case you are skilled in Lithium I guess Sven you are in :)
Would be interested to know your views on the Uranium sector and uranium equities. Seems like there are some tailwinds: nuclear energy for low carbon, reliable supply of energy, more demand than supply, policies supporting nuclear energy generation etc. looks like a good play for the long term. Companies like Energy Fuels Inc. are also involved in Vanadium and Rare Earth Elements which are crucial for making batteries, magnets, EVs, anything that will help the energy transition! would love a video on it, thanks Sven!!
Uranium producers were a good buy one year ago or earlier, but now everything is priced in, and the current uranium price is high enough to already incentivize the start or restart of mines. It can go higher for sure, but the production growth will limit the upside at this point.
@@robertdagge200 The U stocks that didn't move probably have a very low probability of entering production during this cycle. All the producers and most developers with realistic plans for mine construction did indeed move, and some even moved a lot.
Hey sven i saw your last vid about market guidance and i totally agree with bonds and EM strategy. I have to you one question or suggestion. I am also using IBRK - and they have a program for accounts with NAV of 100k 4.8% yield with no risk no trade parked there can you elaborate more how that works? Sounds like a too good to be true deal!
there is a reason why lithium drops in prices: 1. New battery technology (sodium-ion for example) use 50 to 70% less lithium. Sodium cost $350 per ton, Lithium $80,000. Sodium-ion is safer, and works better at lower temperature, power density is improving. 2. New Lithium mines have been found 3. Approximately 95 percent of a lithium-ion battery can be recycled into new batteries, at a fraction of the cost of mining. I guess, it will take a while ( 2 to three years) before the supply of various sources of lithium, and new battery technology become available will drop the price of Lithium even further. May be a short term upwards cycle.
this is exactly how a cycle works when prices get extremely high: 1. Alternatives are found 2. Explorers are heavily incentivized to explore for new mines, that with lithium isn't such an issue to mine 3. linear estimations of the future usually don't include changes:-)) But this will all make things very volatile in the environment, maybe there will be an opportunity for us, maybe not.. we will see
@@Value-Investing exponential disruptions are paving our future. As investors we need to put that as part of our investing strategy. I bought Nvidia in 2016 because they were at the early stage of AI (GPU = parrallel processing = neural networks = AI). This is so far a 70x investment. Lithium batteries have dropped 90% in price over the last 15 years, and are going to drop again another 90% by 2035. Disruption goes two ways
As it is now with current prices, lepidolite producers have stopped as it is uneconomical, and the profit margin on spodumene is so low that it is either becoming uneconomical or it is not feasible/risky to start up a new mine due to the Capex. High prices cure high prices, low prices cure low prices. It will take years before any alternative battery tech will put a significant dent in lithium battery tech. All those new Gwh battery factories under construction have equipment on order that their owners do want to earn back at least, otherwise it's a write off. We may not see 600k yuan per tonne of lithium carbonate, but the current price will more likely than not rebound from these levels
Thanks Sven. I've never asked you for a video but I wonder if you could do the same for Nickel Nickel has dropped massively recently due to increase from Indonesia. I wonder if now is the right time.
Hey Sven I'm currently researching Nickel. I just wondered about your thoughts regarding whether Indonesian nickel forcing many other nations to place their nickel mining on hold will actually stabilise prices now. Are we near a bottom do you feel? I own Nickel Industries. A nice company with growing dividend out of Indonesia. Check them out. Thanks
lithium is abundant all over the world and relatively easy to extract there is absolutely no reason for lithium prices to be very high or lithium miners to make extraordinary profits in the long run even with a growing EV market. but there are always short term opportunities as Sven said
Loved the “elephant” reference, lol! I don't know, I think lithium is riskier than copper, gold, fossil fuels... because apparently people is starting to realize EV cars are just not practical at all... One can make a lot of money with lithium miners, but I think at this point it's a bit easier or more predictable just stick to those for now. Thank you!
Lithium prices are gonna go down, never seen an oversupply in a commodity industry like this. Typically they are underinvested in , this was insane hype for some reason
I think if I am watching TH-cam for ideas I am probably a defensive investor. I avoid cyclicals once I have identified a stock as one as I don’t think I have a chance against “smart money”.
Can you explain why you diligently covered Chinese equities day in and day out when they traded 2-3x higher than today, and repeatedly said how great those businesses were and how they could easily 3-10x, while you now ignore them completely (nothing beyond repeating that emerging markets are cheap)? I think everybody can see that China is cheap, and yet it keeps getting cheaper. Why are JD's shares worth less than the cash in the balance sheet if it is such a great business, for instance?
Do your own research but Enovix just proposes a technologies enhancing the performance of batteries ("improving the packing efficiency of the active materials" ) . The batteries don't work on silicone (and how would they?!) but still with lithium as the active material. Other technologies currently are not fully developed, and would be more seen as "bombs on wheels" if it is used in cars.
@@winterskiU and then there are solid-state batteries which have an even higher lithium content than Li ion batteries. So the demand could grow even faster. Who knows - the future is uncertain.
There is just so much supply coming on soon (wait till South America starts ramping up production) that you simply cannot go anywhere near this sector for years. Stay short.
I just initiated a starting position of ALB, ready to add here and there.
Like the statement "take it with the pinch of lithium" 😊👌
:-)))
I love these analysis, thank you. Deep dives into new sectors to gain some new perspectives and expand circle of competence. All knowledge is cumulative.
thanks
I really like the method you're using, where you estimate demand growth and compare it to the supply growth created by the biggest companies. One thing I will take home from this is that future demand estimates given in company presentations are not always the most realistic.
Well said!
Well done - great breakdown & market analysis. I'm long on LAC. So long that I might forget about it.
thanks for sharing!
Same as you. I also hold LAC shares for long term. May be two to five years
Nice. I always enjoy your miner / commodity videos. They just make so much sense. And while I was too late for the gold and copper cycles, I can now actually prepare to take advantage of this.
I am looking at the commodities, most of them, usually twice in a decade you have a great opportunity.
Thank you for the deep analysis Sven.
My pleasure!
Thank you, Sven. I bought Livent (LTHM, now ALTM) after your video. Lithium price is still dropping but I plan to hold for a few years . Thank you for bringing it on my radar.
Thanks for sharing!
Sven, your videos are always great and educational, and I especially enjoy your commodities and miners videos, and in this one you really outperformed even your own high standard. It was the best "lunch and learn" video I could have picked for the day. Thank you :-)
glad you enjoyed your lunch
My fill of lithium
Sven, thank you for your hard work. I noticed the drop from Lithum price and i was trying to do some research to see if its a good time to buy now. And then i see this video poping , like a gift from heaven. You literally justified my thinking. I hope you keep the good work and make our lives easier. I really plan to become a future member at your platform. I think you are one of the few guys that i really listen when i am making my investing plans. Thanks again :)
great to hear!!
Great detailed analysis on both the market and companies Sven, thanks for your insights
thanks
An analysis of great value. Thank you Sven 👍🏼
My pleasure!
That’s a very interesting take.
thanks
Super helpful analysis, thanks, Sven!
Thanks!
This is the video I've been waiting for. Dr. Sven is an EXPERT on metal commodity cycles - especially copper.
Thanks!
Love your commodity analysis videos. Because it's not easy to analize them as a layman
great to hear
Why this kind of content for FREE doesn't get more views amazes me. Thank you.
:-)
Thanks Sven, stay warm.
:-)
Very nice analysis! Please keep us up to date on this subject. Awesome!! I'm holding $ALB myself.
thanks!
Thanks Sven! Great video and great insight into Litium sector :)
Glad you liked it!
6:00 the historical reference to copper Supply/Demand projections got my sub. Great explanation and actual long-term considerations, not WallStreetBet StONks. 👍
Thank you Sven, I was waiting for it and appreciated.
I am since sometimes into Pilbara and it seemed to me it is reasonably valued till the cycle picked up again in next years.
Thanks for sharing!
Its so good that you actually check the data! this is why im subscribed to the platform!
thanks, great to hear
I like explorers at the moment with new discoveries that have just taken huge share price hit. The ones with great projects can develop them over the next five years as the lithium price recovers.
@6:20. As you said the forecast did not matched with the estimated value. That why margin of safety is important. We need only to put money when we see there is discount of 40-50%. As buffet used to say wait for the fat pitch. and charlie munger used to say people can make more money in waiting and be prepared to gain from asymmetricity.
Thanks for posting this Sven, it was most educational for me.
My takeaway was there is far more to buying into commodities than first meets the eye.
In short I do not have the ability to be confident to place a bet and my interest are best served by just saying no.
Thanks for the lesson, regards Andy
happy to hear that, thanks Andy!
Good research on how copper supply and demand forecast 10 years ago has played out. And if it is hard to predict copper demand 10 years ahead it is nearly impossible to predict lithium prices. Who knows about technology with lithium and its adoption decade ahead? And supply is a tough one too, since there are multiple sources and lithium "mining" is prone to technological changes like oil drilling by products etc.
It wasn't that hard to predict, it was just cherry picking data to make the stock look better:-)) With lithium it is different...
'pinch of lithium'.. Good one Sven :)
:-)
A look at semiconductors would be very interesting.
sgml is hammered man
I love SQM. They operate efficiently and structure their dividend policy really wisely. Those elephants you mentioned, one of them is actually positive, the joint venture. The other “elephant” has been a point of contention for a while, as the government has tried to nationalize the company more than once now. It’s political jargon and I don’t think that will happen. The company also just entered the West Australian market with the likes of the richest Aussie I believe. Not to mention their agriculture involvement, being close to the LatAm market. This company is so nuanced that I love how it scares popular opinion 😊
how is losing 51% of what you own now positive, which is what goes into the JV
Battery storage and electric cars are going to take off so I think Lithium demand will be fairly solid
you dont think that has already been calculated in the expectations?
that is the plan
Excellent analysis and strategy! Other commodities that seem to deserve a detailed sector analysis are graphite and tungsten: they are both niche commodities whose production is almost monopolized by China, and are crucial respectively for the anode of batteries and for industrial production and defense.
those are difficult 'commodities' to analyze and invest, not all commodities markets are investable, lithium is also tricky.
Sven--- Economy is slowing 🐌....and Battery 🔋 Technology is improving...
Will keep an eye 👁 on a few....
Thanks
good points
I talked to an analyst who put 6k into ALB recently. He said it’s the single stock in his IRA. How much lower can it go?
incredible analysis
thanks!
I bought into Pilbara when it was 0.42 cents. Now it is one of the most shorted stocks in the ASX, It pays some dividends is well.
Sven can you have a look at sodium batteries BYD is already producing cars with it. Much cheaper safer and easier to recycle it. I wonder how it will play out.
thanks for suggesting, new tech is a risk...
Chinese are very innovative, in the west the ingenieurs are more woke... 😜
.
You did not touch on the lithium royalty company play (LIRC in Canada). LIRC is currently trading at some 50% of NAV (as per company presentation). It's not clear to me at what lithium price exactly the NAV is calculated, but should be the long term consensus price.
Royalty companies, albeit usually more diversified then LIRC from a commodity standpoint, have much desirable added benefits when compared to the mining companies, first of all they are insulated from production cost increases, so it's quite rare that they trade at such a discount to NAV.
if they calculate NAV at $60000 lithium or estimated $20000, with prices now at $10000, you get your discount.
great analysis!!
Very useful & actionable analysis.
the action depends on the viewer :-)))
I admire your depth of knowledges and analytics! Now that the SQM codelco deal has been signed, do you agree that SQM stock can be sold for ~ $75 in 2027?
depends on lithium :-)
Sven, very nice video. The difficulty I have with Lithium or Uranium or Silver or even copper is that the cycle is very much dependent on a macro scenario, inflation, interest rates, economic growth and, in the case of Lithium, the development of new technologies. It seems very difficult to derive timing.
I think that you don't have to look too much at the macro scenario, you have to focus on what is going on with the specific commodity in question, which is oversupply and lower prices, regardless of the macro picture. When the lower price will touch the cost curve and drive some lithium producers out of the market, we will know it as it happens. If the producers with the highest cost start to go bankrupt, it will be a good entry point into the higher-quality ones, because the supply will go down and the undersupply will sooner or later lead to higher prices again, regardless of the macro picture.
yes, it depends on the macro, but my strategy is to buy it when it is so cheap that there is only upside, then the macro adjusts in a period between a week and 5 years.
@@Value-Investing that is the best strategy. Thanks again for the video.
a pinch of lithium !! Thanks!!
:-)
Thanks Sven. Worth looking into Uranium
thanks for suggesting
thanks Sven PLS looks great here
Please analyze Uranium. It's liking good.
thanks for suggesting
5 lithium stocks and detailed sector Analysis
:-)
Thanks for the great analysis, as always, Sven!
As we talk about cyclical stocks isn't it good idea to check again ForFarmers N, Farmer Bros or JDE Peets ?
They are down right now. I think a video for them (the sector) will also worth.
Thank you!
thanks for the reminder
Lithium is tricky. You have growing demand for EV batteries. You also have much more efficient batteries being created as well which could cut Lithium demand. If one of these alternative no lithium batteries works out, then lithium demand will crash hard. EV tech is advancing so fast that it is hard to make a good call on the materials involved.
yes, the tech is the biggest risk...
I dont see why no lithium batteries would be better, you have to have a cheaper metal alternative then and Lithium is already very abundant and cheap so I doubt that will happen. It's also the best contender for solid state batteries.
Except for maybe Magnesium, if theres a good solid state magnesium battery coming out then yes lithium would be worthless , but this feels 20 years away
More efficient lithium batteries would just make more people want EVs, probably wouldn’t hurt lithium prices
miracles for junior miners like a major producer got trouble with a mine and have to buy a better mines, that's why I will try to find magic junior for the sector that have high chance to be bought by a major.
thanks for sharing!
Thanks, good analysis! Are you going to analyze Piedmont Lithium any time soon? Seems to be potentially a pretty good lithium play
you can read on the platform, it is in free preview
Thank you for the video Sven... I must admin, When Chiliean Governament nazionalized SQM's litihium mines, i felt like a stupid investor...
thanks for sharing Davide
@@Value-Investing In december 2023 Chilean People Voted against the change in national costitution, in a blow to the president (that wanted to change it to be more "socialist friendly"). 4 Months after that, the socialist president decided to nazionalize 51% the litihium mines of SQM anyway.. that was Tragicomic! :O
Very interesting. Thanks as always for your thoughts. Have you ever done an analysis of Weight Watchers? WW? They have been around for so long, and they just recently lost nearly 50% in a super short amount of time. Possibly a Value Opportunity? Just a thought. Grazi!
thanks for suggesting!
Hey Sven, can you review KVUE? Peter Lynch loves spinoffs, this is a recent spinoff from J&J!
thanks for suggesting!
What about LAC?
haven't checked it in this round!
Very nice video Sven! What about palladium stocks, palladium is on 2017 level, are the stocks cheap to?
here you go, pretty much sums up things ; th-cam.com/video/B2L08l-osCg/w-d-xo.html
Muy buen análisis, como es usual en el canal, crees que el mismo potencial con el Litio pueda suceder ( o estarse creando ) con el uranio? Si el uso del automóvil eléctrico no se diera como se planea, podría afectar al mercado del Litio? Gracias por tan buena información, Saludos
no saves, necessito analizar
Great analyses! Could you please analyse the hydrogen sector which seems to be "out of fashion" as well? Thanks for your much appreciated work 👍👍👍
interesting suggestion, but hydrogen is even trickier than lithium...
Dobar dan brate (you belong to the Venice Republic as well at the end of the day)! I scored an average of 15% yield in a couple of months just watching your videos (ADM, FMC and ALTM this week) and as I'm coming to Amsterdam in May I was wondering if it's possible to return the favor inviting you for a cocktail/dinner! Thanks for your work :)
Hi, not living in the Netherlands anymore, back to the Serenissima, send me an email.
Dear Sven, what do you think about Koninklijke Ahold since last year? Seem like a good price point again now or will it go lower? ;)
I would need it below 20 to consider.
Great video Sven! Quick question, is it possible that when we take into effect the tendency of central banks to lower the interest rate in the near future as a possible catalyst for EVs demand and thus for Lithium price? As you showed, EV demand has somewhat stalled or even worse in western country because when debt is so pricy nobody wants to buy a car (and certainly not a pricy car), but when debt doesn't cost much, everybody wants a new car, the new thing (in this case, EV cars). So I guess my question is, when we take into account the cyclicality of the economy (and interest rates), is it possible that the lithium market shoots before 2030?
there will certainly be ups and downs :-) Impossible to predict
Hi, I was looking at encode wire. They have 0 debt, a single digit p/e ratio, but sporadic growth that may indicate they're a cyclical. Are they exuberantly priced because of the current high prices of copper ?
what is going on there?
Would have liked to see Ganfeng analysis in this video since it is in my part of the world. Nevertheless this is useful to me.
will check deeper
Dr Sven,
How is it possible for Piedmont to have such a low production cost for lithium hydroxide when they have no experience and expertise in refining spodumene? They have huge plans and are currently driving Sayona broke in supplying spodumene at very low levels but a potential Spodumene supplier from Atlantic in Africa?
don't know the details, I see they have many projects, which makes it risky for me...
Thank you so much Sven, can we do PayPal next? It’s down a lot since last review and seems to be undervalued ?
th-cam.com/video/ScDjrZjWfFg/w-d-xo.html
fascinating work Sven! in conclusion, we wait some more on these stocks. no hurry to enter. macro lithium is not stretched. is that correct?
that is the best risk and reward situation, but then, anything can happen
@@Value-Investing haha revisiting this video following your new one today. i like ALTM at the moment. may be the one i enter into.
Nice job¡¡Congrats¡¡
thanks!
Thank you very much¡¡Nice to see you here¡¡@@Value-Investing
Thank you vey much, it was a great video. But I don't understand this: Looking at Albemarle's share price history, it had a stable period between 2011 to 2016, at around $40-$60 per share. Back then, lithium (carbonate) price was also relatively stable, around $6.000 per metric tons if I'm not mistaken. And now, after going to the moon and crashing back to Earth, lithium price is still higher than those 2011-2016 values, and most likely will remain so even with the most pessimistic scenarios, whereas Albemarle share price is now at only around 2 times of its 2011-2016 value even without adjustments. I am quite sure that since back then, this company has much more than doubled its size, its capacity, etc. So its current price just doesn't make sense. What am I missing here? Thanks a lot!
yes, but also the costs of that capacity increased, taxes in Chile etc...
Thank you very much for your response@@Value-Investing . I agree that the costs really do matter, especially when the price is that much depressed.
But, from a valuation point of view, on one hand we have Albemarle 10 years ago, with X price per share, and on the other hand we have Albemarle today, with only 2X price per share. Lithium price has increased, even after its recent ups and downs. I don't know, its current price after 10 years feels wrong, but maybe I should do more math instead of relying on the feelings.
And from a cyclic commodity point of view, as you mentioned in your video, the meteoric rise of lithium prices must have given way to new projects. But now, with the current prices, most projects must have been economically unfeasible, right? When do you think we can see this effect in the supply side?
I suppose big players who can survive this cycle should prevail eventually. Actually one of the things I like about Albemarle is its diversification of revenue streams, which should provide some relief during down cycles.
Best Regards!
Very good 👍🏻👍🏻
thanks
In summary, the outlook is so terrible that it might not be too bad.
The prediction that it’ll be 2028 before undersupply is based on production increase forecasts that likely will not be met because the near term price will be low enough to reduce production from what it would have been.
In other words, it’s entirely possible that demand exceeds supply *before* 2028 due to how badly supply is exceeding demand.
*scratches head
Did I get that right?
TLDR: Consider buying lithium miners in 2024, but only the lowest production cost companies, and only on dips.
Good summary! I would add that it is better to avoid timing bottoms and tops! Just look what is going on
@@Value-Investing thanks for the video.
How do you go about getting a company’s price to produce lithium? Am wondering about ALTM.
Wake up Sven! You told us to message you when ALB is 8B market cap range (nom book value - not tangible equity). Any thoughts? Lithium prices have also crashed.
Hi Sven, I do not think there is company without any potential issue . I guess you will never buy APPLE of Microsoft several years ago :) ALTM get another hit today so market cap is now 5.5 B after merge so in case you are skilled in Lithium I guess Sven you are in :)
I did buy Apple in 2016 :/))) but yes, all business have issues, the key is at what price it is worth it
@@Value-Investing yes you are right, it is difficult to hit that BUY button :)
Would be interested to know your views on the Uranium sector and uranium equities. Seems like there are some tailwinds: nuclear energy for low carbon, reliable supply of energy, more demand than supply, policies supporting nuclear energy generation etc. looks like a good play for the long term.
Companies like Energy Fuels Inc. are also involved in Vanadium and Rare Earth Elements which are crucial for making batteries, magnets, EVs, anything that will help the energy transition!
would love a video on it, thanks Sven!!
it is a hard sector
Everything is already priced into Uranium stocks. Most of them are at all time highs just like the Uranium-spot price.
Uranium producers were a good buy one year ago or earlier, but now everything is priced in, and the current uranium price is high enough to already incentivize the start or restart of mines. It can go higher for sure, but the production growth will limit the upside at this point.
A lot of UR stocks have hardly moved and are still a buy - one coy I own is down (...) 70%. But these coys are generally small and high risk.
@@robertdagge200 The U stocks that didn't move probably have a very low probability of entering production during this cycle. All the producers and most developers with realistic plans for mine construction did indeed move, and some even moved a lot.
Why would you buy Arcadium over Pilabara?
depends on the price
Hey sven i saw your last vid about market guidance and i totally agree with bonds and EM strategy.
I have to you one question or suggestion. I am also using IBRK - and they have a program for accounts with NAV of 100k 4.8% yield with no risk no trade parked there can you elaborate more how that works? Sounds like a too good to be true deal!
they take your money and put it in t-bill at 5.5%
@@Value-Investing that's good or bad?
there is a reason why lithium drops in prices:
1. New battery technology (sodium-ion for example) use 50 to 70% less lithium. Sodium cost $350 per ton, Lithium $80,000. Sodium-ion is safer, and works better at lower temperature, power density is improving.
2. New Lithium mines have been found
3. Approximately 95 percent of a lithium-ion battery can be recycled into new batteries, at a fraction of the cost of mining.
I guess, it will take a while ( 2 to three years) before the supply of various sources of lithium, and new battery technology become available will drop the price of Lithium even further.
May be a short term upwards cycle.
this is exactly how a cycle works when prices get extremely high:
1. Alternatives are found
2. Explorers are heavily incentivized to explore for new mines, that with lithium isn't such an issue to mine
3. linear estimations of the future usually don't include changes:-))
But this will all make things very volatile in the environment, maybe there will be an opportunity for us, maybe not.. we will see
@@Value-Investing exponential disruptions are paving our future. As investors we need to put that as part of our investing strategy. I bought Nvidia in 2016 because they were at the early stage of AI (GPU = parrallel processing = neural networks = AI). This is so far a 70x investment.
Lithium batteries have dropped 90% in price over the last 15 years, and are going to drop again another 90% by 2035. Disruption goes two ways
As it is now with current prices, lepidolite producers have stopped as it is uneconomical, and the profit margin on spodumene is so low that it is either becoming uneconomical or it is not feasible/risky to start up a new mine due to the Capex. High prices cure high prices, low prices cure low prices. It will take years before any alternative battery tech will put a significant dent in lithium battery tech. All those new Gwh battery factories under construction have equipment on order that their owners do want to earn back at least, otherwise it's a write off. We may not see 600k yuan per tonne of lithium carbonate, but the current price will more likely than not rebound from these levels
Thanks Sven. I've never asked you for a video but I wonder if you could do the same for Nickel Nickel has dropped massively recently due to increase from Indonesia. I wonder if now is the right time.
Nickel is more complex than even lithium, but thanks for suggesting, you never know!
Hey Sven
I'm currently researching Nickel. I just wondered about your thoughts regarding whether Indonesian nickel forcing many other nations to place their nickel mining on hold will actually stabilise prices now. Are we near a bottom do you feel? I own Nickel Industries. A nice company with growing dividend out of Indonesia. Check them out.
Thanks
lithium is abundant all over the world and relatively easy to extract there is absolutely no reason for lithium prices to be very high or lithium miners to make extraordinary profits in the long run even with a growing EV market. but there are always short term opportunities as Sven said
yes, unlike copper, there is plenty of lithium, and the recent boom has put more people searching for it...
Sven, I believe battery producers shall benefit more from the ongoing lithium price weakness.
costs are usually just pass through.
what about SLI?
haven't analyzed it yet!
thoughts on LAC? recently split the company. LAAC is the other i believe
will have to check
appreciate that thank you and look forward to it!@@Value-Investing
How about the stock called LAC? Any comments for this stock? Thanks😊
haven't looked in depth yet
@Value-Investing Noted and thanks for your reply 👍
BYD is talking with SGML
What about the mining gaint Rio tinto
that is iron ore, lithium is just a small part and I think their Jadar project has big issues!
Loved the “elephant” reference, lol! I don't know, I think lithium is riskier than copper, gold, fossil fuels... because apparently people is starting to realize EV cars are just not practical at all... One can make a lot of money with lithium miners, but I think at this point it's a bit easier or more predictable just stick to those for now. Thank you!
thanks for sharing!
Why does Arcadium have a 0 % dividend yield?
growth focus
Lithium prices are gonna go down, never seen an oversupply in a commodity industry like this. Typically they are underinvested in , this was insane hype for some reason
:-)
Strong EV demand....is the big question
there is demand, so we will see
Can u do graphite sector
that is truly a difficult sector
I think if I am watching TH-cam for ideas I am probably a defensive investor. I avoid cyclicals once I have identified a stock as one as I don’t think I have a chance against “smart money”.
:-)
Can you explain why you diligently covered Chinese equities day in and day out when they traded 2-3x higher than today, and repeatedly said how great those businesses were and how they could easily 3-10x, while you now ignore them completely (nothing beyond repeating that emerging markets are cheap)? I think everybody can see that China is cheap, and yet it keeps getting cheaper. Why are JD's shares worth less than the cash in the balance sheet if it is such a great business, for instance?
the stock market is a voting machine in the short term, a weighting machine in the long-term. P.S. nobody knows how long is the long term
Albemarle is a buy for me below 120
thanks for sharing
Seems risky. We haven't considered new battery technologies either.
Yeah, I'm looking at companies like Enovix as an example, producing batteries using silicon and they are about to ramp up in April.
Do your own research but Enovix just proposes a technologies enhancing the performance of batteries ("improving the packing efficiency of the active materials" ) . The batteries don't work on silicone (and how would they?!) but still with lithium as the active material.
Other technologies currently are not fully developed, and would be more seen as "bombs
on wheels" if it is used in cars.
that is correct, sodium batteries with BYD etc...
@@winterskiU and then there are solid-state batteries which have an even higher lithium content than Li ion batteries. So the demand could grow even faster. Who knows - the future is uncertain.
Correct, the only element for which I don't see any possible new technology as a near term treat is copper
what about kering stock?
don't know much about luxury
Lithium is everywhere, there's more lithium than you can shake a stick at.
❤❤❤❤❤
:-)
Pls up 26% in the last 2 weeks. Still 20% shorted🥺
thanks for sharing
Watch out FOR LAC
thanks for sharing
Why buy risky stocks when almost nobody beats sp500 or vwce long term. Why be active investor when almost nobody beats Berkshire
Most hedge funds and zero amateur investors beat Berkshire or SP500 long term
great if it works for you, I would still be a poor kid if I did that
There is just so much supply coming on soon (wait till South America starts ramping up production) that you simply cannot go anywhere near this sector for years. Stay short.
that is a good assumption