Will Refining be the Bottleneck for Lithium Supply? // Part 1
ฝัง
- เผยแพร่เมื่อ 30 พ.ค. 2024
- In this video, I'll address Elon's comment that lithium refining will be the bottleneck for lithium lithium supply, as well as look at margins and the benefits of vertically integrating into lithium refining.
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Timeline
0:00 Introduction
01:16 Thanks, Credits, and Sources
04:37 Why is Lithium the Bottleneck?
06:10 Mining is Easy, Refining is Hard? A Red Herring
07:14 Lithium Refining // Margins
15:39 Fixed Price Contracts are being Phased Out
17:50 Lithium Refining // Forecast and Lead Times
20:39 Why is Tesla Pushing for More Refining?
24:49 Tesla Needs to Flirt Better with Entrepeneurs
25:26 Refining Integration could Save Tesla Billions
27:12 Lithium Refining // Summary
Intro Music by Dyalla: Homer Said - วิทยาศาสตร์และเทคโนโลยี
Its always a good day when The Limiting Factor drops a video.
❤️
I always feel a little bit more informed on evs&cell tech once I've watched Jordan's latest. Also sometimes a bit confused. 😀
Thanks Jordan you rock man! 👍🏻😎
You better say it!!!!!!
1001%!
Jordan, I’m consistently impressed by the amount of energy and effort you put into your videos. We’re all smarter because of it
🙌🤠
Real information in such a well presented way is extremely rare/ hard to find with current algorithms. Thank you very much!!!
You're most welcome!
Thank you so much for this vital information.Never seen a TH-cam channel present this much detail about the inner workings of this growing evolution as much as you have. Again, thank you.
The depth of all your videos are mind blowing! If all youtube videos were on this level, we could literally remove the whole idea of college and replace it with a youtube Playlist!
That is the goal, lol
Someone needs to build a lithium refinery in Australia.
Iluka mining
There is the Kwinana refinery close to green bushes that got online last year.
Will 96,000t of lithium hydroxide be okay?
A youtuber that REALLY does the work, not just reporting the news and opining
🤠🤜🤛
Thank you for these detailed work you do.
🤜🤛🤠
18:10 Yes please, an in-depth video on refining would be greatly appreciated!
Your Videos are the best on the planet on the subject of battery chemistry, content and supply, bar none.
😊
Good stuff. Fundamentally, before Li-ion batteries started shipping in the 1990's, there was little use for Lithium so not much of a supply chain. Now that they are central to EV's and other storage, the Lithium industry will grow to meet the demand. Where there is a will (money), there is a way.
Yes! We'll get there.
The free market would look after this, but there's a lot of government regulation to interferes
Long time viewer and fan who's glad to be a member now! Thank you for all of your amazing research and insight! Keep up the fantastic work, Jordan!
You're most welcome man!
Thank you supporters of this channel. I am greatful.
An important point missed is China, as a major supplier of refined lithium, are currently in a trade war with the US over chips and germanium. Next could be refined lithium.
Thank you Jordan. As usual your presentations are world class.
🙋♂️JORDAN, THANKS FOR DOING ALL THE HARD 😅WORK AND SHARING YOUR VERY “CREDIBLE” SOURCES, 🧐👍💚💚💚
Don't worry, I cover the credibility at the end of the last video
Basically, they are biased, but they're also right
@@thelimitingfactor LOL 👍😎
Lithium 101. At an understandable level . Thank You
This should be interesting
Love the 'toss a coin to your witcher' comment. Awesome Jordan.
Great job, the important information content you present is really well researched and organized. Thankyou Jordan. The Dept of Energy needs to send you a thank you.
😁 Yeah, I know a few people in the government space who follow my stuff. And thanks!
Yes!!! Let go deep on topics, always come away with amazing insights!
Hey Jordan, have you ever thought about doing paid consulting services?
Your experience on a wide range of topics would curtainly be beneficial for the management of many companies. You would just have to advertise it at the end of your videos.
Yeah I've gotten offers.
I'm not really interested at this point
The reason for focusing on refining is because of the high margin starts on top of the selling price from miners. The $ impact to TSLA is higher. Tesla can buy SC at a higher price and do their own refining at a lower overall cost.
Excellent job.
Jordan, the evidence suggests that Wall Streeters aren’t watching. That’s their job, but their conclusions seem emotion- or faith-based. You provide science. Thanks a Frunkfull.
Frunkfull 😁
@@thelimitingfactor Wouldn’t you like a FRUNKENSTEIN in your Frunk?
Thanks!
You're most welcome Natalie! 🤜🤛🤠
Thank for all the material and factory detail
My investment worlds are colliding! This is amazing!
Awesome work
Thanks Chris!
Tesla was also mentioning a new Lithium refining process that has reduced or zero toxicity. There were no proprietary details mentioned, but I believe it's based on a more easily attained feed stock, yet a harder to manage process. Elon stated "Lithium is everywhere".
Yeah, they have a number of internal projects to extract lithium, but most of them have been shut down
Is this the same Elon who said you'd be earning $30k renting out your Tesla?
The same who said the US could be powered by 100 Square miles of Solar ?
Hmm.
Pinch of salt my friend, and ease off the fan boy juice ;)
@@stuartburns8657both Statements are not wrong
@@Matzes mine or the op's ? :;
@@stuartburns8657 yours
At 14:35 you say, "refiners saw higher margins than refiners." I think one should be "miners". Great video though.❤
Excellent. Thank you Jordan.
You're most welcome Doug!
Wooo .... a high quality repository of value chain analysis! Jordan's channel is BY FAR the most valuable of all the TSLA-tubers.
🙏
This presentation is just way above what you'd normally see in youtube. Glad i found you.
🤜🤛🤠
Great video, thanks!
🤜🤛🤠
It sounds like not just Tesla, but the entire battery market needs to get into lithium mining if they want to keep up with demand and level out prices. An actually affordable EV with decent range just wont be possible without seismic shifts in the supply chain.
"An actually affordable EV with decent range just wont be possible without seismic shifts in the supply chain."
Consumers disagree.
@@Apjooz Rich people can buy whatever car they want. But to get to 100% market share car companies HAVE to start making EVs that cost SIGNIFICANTLY less than $40,000, less than $30,000, and potentially less than $20,000. That wont be possible without massive shifts in how we build batteries and source materials.
No, what they need to do is mature Sodium Ion instead. Which is already happening, as that element is 1100 times more common on earth than lithium with just about the same potential.
@@SimonMester Yeah, I wrote that before we had a whole entire sodium ion revolution. 6 months is a long time in these technologies now.
U earned top award 4 content!!
Amazingly informative video! Thank you so much.
Would love a follow up video on the details of lithium refining
Excellent content as always!
Jordan, thank you so much. I just turned back on my Patreon subscription. I had shut it off for seven months when Tesla stock collapse but I’m coming out of my funk. 💪🙏
Awesome! Thanks man. Yeah, a lot of people were in the same boat. I figured it was an appropriate time to jingle the change can, lol.
@@thelimitingfactor it was a nightmare! I saw 50% of my life savings vaporized in 2 months. With 10,000 shares at an average price of $240,December & January were such a shock to my system that I fell into clinical depression. All better now thank God and loving the fact that I didn’t panic sell. Watching about 90 minutes of Tesla TH-cam videos daily throughout this time was critical to maintaining my conviction. I’ve watched every video you’ve ever created and was a long time Patreon supporter for 2020 and 2021. 💪😀
Fantastic analysis. Can't wait to see the rest
Jordan, I love your intro. Cool and concise.
Thanks so much Jordan!
Excellent… very refreshing…a firm taking the long view…Vertically integrating (an MBA no no!)…collapsing the value chain with disruptive technology…buying equipment 18 months in advance… the new processing technology could take another 30+% out of refining cost… then there is cathode & anode manufacturing…squeezing the lemon!
Yeah baby!
Hi Jordan, great video as usual. It would be great to hear more deep dive about advanced Li separation techniques, for example using solid scavengers, like delithiated spinels that relithiate on contact with Li brines.
Thanks! You’re a monster on the Twitter like speed!!! You are an Impressive man!
Lol, thanks. I pretty much spent the whole day here and on Twitter today.
Usually my responses are a bit more timely and better written on Twitter. But, I try to keep up with both.
Great work!
Excellent information. I joined via Patreon. Keep up the great work!
Thanks Jack!
One of best presentations I have seen. Thank you.
🤜🤛🤠
Thanks for the great video.
Thank you!
Excellent presentation! Thank you. 👏
Excellent again!
Awesome work 👏
Hi there! Great work as always.
I wonder if you're still following Talga and/or Novonix? What's your take on their development since the last videos you did on them?
I would also be interested
Thanks man!
I stopped covering them because covering them tended to attract people who invest in penny stocks and junior minors...
There was a real get rich quick mindset.
@@thelimitingfactor Thank you for getting back so quick.
I understand your point. It's a shame really, because you really opened my eyes to what they're trying to achieve. Your technical insight is superb.
Fantastic video as always Jordon!
🤠
As a basic MBA strategy, expect that commodity processors will announce more projects than they expect to actually build. This is a near-free way to discourage new entrants and expansion of existing processors. So, best to be skeptical of claims of high lithium refining capacity in future years.
That sounds more like a Machiavellian strategy than an MBA strategy, but I like it, lol
Amazing, THANK YOU
great episode
Bloody legend Jordan. Thanks for the content
Bravo and thankyou
There is a small company called EnergyX, based in Austin Texas, that has developed, designed and now build a new way of mining Lithium. It is far cheaper and the yield is 3 times higher than current mining. They have also recently started designing and building their own batteries. It's definitely worth checking out.
Anything that's not already commercialized right now won't have an impact by the end of the decade
Incredible video!
Thanks man!
Solid content
Havent seen sucha detailed video on the entire internet. Amazing efforts and superb execution. Would love if you can make future videos on the refining process as well. Any new battery tech Sodium/ Aluminium/ Redox coming up and what is your take on it? which one will realistically be able to replace or be at par with Li Batteries in commercial usage.
Great lithium video
Lithium is history !
Hi, I love your work on the lithium industry. It's obvious you've put a lot of effort into it! The only issue is the last point about the financial benefits for Tesla's inhousing of LiOH refining. The market doesn't quite work like this - i.e., taking the saved margin multiplied by a P/E of 30x. Albemarle only has a P/E of 10x. Since the market won't pay the same multiple for LiOH refiners, the opposite result is likelier, that Tesla inhousing LiOH will actually lower their market multiple. (in other words, if they entered into an M&A with ALB, we can be fairly sure their combined multiple will fall, so no reason for their inhousing to result in the opposite outcome when it results in a similar entity.)
My perspective was that all of Tesla's margin from all sources goes into a big bucket. That is, they'll get the PE ratio of a growth tech company.
I think right now their PE ratio is 80 and rising. So I didn't think 30 was outlandish.
But I appreciate the point you made! Good insights!
great video
Impressive video! 🥇 🏆
So excited to fall asleep to this one ; )
Lol!
Thanks! Witcher
Coin tossed to my Witcher. Thanks 😊
🤠🙌
Thanks
Danke!
Bitte!
See you got to the answer at the end. Correct.
Trying to keep their incredibly high margins will just push Tesla (and others) to look at alternatives like sodium ion batteries.
They already are, but it takes about 5 years to get that train moving. Covered later in the video
Impressive
*Queue Darth sidious gif*
Thank you for sharing this high quality research video.
A question is, when it comes to LiOH margins(12:00), why spodumene cost/price is not included in refiners' price and cost?
just wonder why refiners' price and cost is not 64000/54000, but 15000/5000. Cuz depending on which of the two options I choose, refiners' margins can look very different
Because I was just looking at production cost.
That's because mining is pure production cost. It creates an equivalent comparison.
@jayjang7946 I had the same question. See my comment and reply (above) from 1 day ago. If you include the refiners cost for the spodumene, the refining profit margin is only ~18.5%. The cost of the Spodumene concentrate is a "production cost" to the refiner. So when you include the spodumene cost and use other numbers from the video, refining clearly has a much lower profit margin than lithium mining, even lower than indicated in the video. However, to do true apples-to-apples comparison, you would need to include the effective annual capital cost of the mine and the refining plant. I think a lot of followers of the limiting factor may be trying to decide whether to invest in miners or refiners. I would like to see Jordan update this video with a more detailed apples-to-apples analysis of lithium mining and refining economics.
Thank you!
Mining LI in Mexico? They've significant known reserves.
Any planned mines would be included in benchmarks forecast. And sure thing!
A potentially bigger issue than LI, but which gets little publicity, is graphite mining. All(?) Li-ion batteries use graphite.
Currently, virtually all battery grade graphite is purified in China, which means significant supply risks for non-Chinese battery manufacturers.
Benchmark Minerals expects that graphite mining will need to increase 6 times by 2035 to meet the expected demand.
I don't think Tesla has advised how it intends to ensure its graphite supply.
They have, they said they're building an anode plant twice now.
Graphite is a concern, but I'm not going to cover it unless this video series does well.
I would like to support you. Which platform do you prefer? TH-cam, Patreon or Twitter? Is there a difference between the content you provide on each platform?
Twitter and Patreon are the best.
That's for two reasons:
1) On each of those platforms, as much as possible, I always try to post the video a week early.
2) It's easier to communicate with people
Beyond that, Patreon offers several tiers with different perks, whereas on Twitter there are no perks and one tier ($3/month)
Thanks for asking!
Tak!
🙏
Is another possible reason for more refining capacity versus mining: recycling of batteries will require lithium refining and reduce needs for mining over time?
That inflection point won't happen until next decade
Recycling will be more like repurposing,be it in grid storage,or whatever,Uses for (Near End of life) lithium ion batteries,comes down to creativity
@Hostnobail reuse and recycling will both be viable possibilities for second life or end of life batteries. This lags the battery production curves by about 10 years + . Except for bad cells from new manufacturing that needs to be recycled to leverage materials and avoid waste
IMHO, combining mining and refining will mean:
1: Less transportation costs, faster, and better for the environment. 🌎
2: We don't need to rely one one country (China) for refining, meaning greater political stability. 🤝
Amen!
Always very informative! Lots has to be done before the world can produce 100 million EVs a year, make all Semi trucks electric and begin to significantly electrify planes.
How far can we get with current tech and scaling of mining/refining. Is another tech needed?
We already have the technology too electrify small propeller traditional takeoff and landing planes.
The tricky part is doing big planes with jets
@@thelimitingfactor absolutely. Small electric propeller planes are pretty good already. I wonder what kind of electric propulsion proves to be the best for larger planes.
Even though electric motors are very efficient, the energy density of batteries compared to fossil fuels is very low.
👍
Just started the series and it is excellent. Any thoughts on why Tesla doesn't simply buy a bunch of companies that do Lithium refining? Or for that matter buy mining companies as well. They could set up a refining operation in China, refining in Australia, South America, and in Mexico close to the border. Another thing Elon could do is donate to mining schools, perhaps adding engineering buildings to many campuses in the U.S. He could also offer scholarships to students who study materials science, mining, chemical engineering, etc. Then offer those graduates internships along the way and employment upon graduation.
Rather than buying refineries, they just decided to build their own.
I think they don't want to be associated with the mining industry, as I cover later in the video series
91% miner margin and 67% refiner margin are, as Guy Ferreri says, out of bounds. Way too high. Elon's forte is to cut out the middle man, which he is already doing in refining. Wouldn't surprise me if Tesla got into mining.
Skim those sweet profits!
Lithium Mining & Refining Detailed Report! 7/8/2023!
Is there lithium refinery in CANADA??? Good report
I clicked on Like before I watched, I hope that is okay ;)
lol, permitted
the environmental aspect is well pointed by Sigma Lithium (only 560 pages 😁) exposed at the COP 27 in Egypt, AMG Lithium is taking the raw material partially out of is waste rock pile of the tantalum and other minerals production, AMG covers the complete process owning the mining place downstream to refinery
It's better to link what you're talking about rather than making abstract references. Then people can follow up.
5:43 iron ore is so big because it’s ore not the metal. 2.6B tones of ore -> 1.6B tons of metal. Still same order of magnitude but not as big.
Good point!
Will Lithium Spodumene be replaced with the NaCl refining process?
In some instances, but not for existing facilities
Over the past seven years, I have dedicated a significant portion of my investment portfolio towards the lithium mining sector. This strategic choice reflects my belief in the sector's substantial growth potential and the broader transformation of the energy market. Here's why I have made this decision:
Tony Seba, a renowned thought leader and forecaster in the field of clean energy and transportation, has long posited that advancements in technology and declining costs of electric vehicles (EVs) and renewable energy would significantly disrupt the global energy and transportation sectors. Following this line of thought, we can create a scenario for lithium demand in a recessionary market that's driven by technological deflation and rapid growth in EV sales. Despite a recessionary market typically implying reduced consumer spending and slowed economic growth, Seba's model implies that certain sectors may still experience rapid growth due to significant changes in the technological landscape.
In a recession, lithium investments may offer a strong hedge for several reasons, comparable to how oil did in the early 1900s, during times of volatile deflationary recession. Here's why:
1 - Technological Shift: Just as the 1900s saw a rapid transition from coal to oil due to the latter's greater efficiency and versatility, we are now witnessing a similar shift from fossil fuels to electric energy, primarily stored in lithium-based batteries. This change is driven by environmental concerns, technological advancements, and economic feasibility. Even during a recession, this trend is likely to persist because of the long-term benefits and existing momentum in policy and infrastructure.
2 - Growing Demand for EVs and Renewable Energy: The demand for electric vehicles (EVs) and renewable energy is rising, driving the need for efficient energy storage solutions. This increases the demand for lithium, a key component of these energy storage systems, making it a potentially resilient investment during economic downturns.
3 - Policy Support: Governments worldwide are implementing policies that favor the transition to cleaner, renewable energy sources and electric transportation. These policy incentives can help shield lithium investments from some of the worst impacts of a recession.
4 - Supply Constraints: Lithium supply is constrained by a limited number of producers and geographical distribution. Any disruption in these areas could potentially increase lithium prices, thereby potentially providing a hedge against economic downturns.
5 - Essential Component: Much like oil, lithium is an essential component of a growing industry. In a recession, necessary goods and services typically fare better than luxury or non-essential ones.
6 - Inflation Hedge: Commodities such as lithium often serve as a hedge against inflation. While deflation is often the immediate response to a recession, governments' response to stimulate the economy often leads to inflation in the medium to long term.
These factors could make lithium a strong investment during a recession. Lithium presents a unique growth opportunity among the metals market, primarily due to its critical role in the energy transition. Here's why it has the most catching up to do infrastructure-wise, hence indicating the highest growth potential:
Infrastructure Gap: Unlike metals such as copper, zinc, tin, or nickel, which have been extensively mined and used in various industries for centuries, commercial lithium extraction and usage is relatively new. There is still significant room to expand lithium production and refine extraction techniques to meet the expected surge in demand. This infrastructure gap represents a vast potential for growth that is arguably more significant than more established metals.
Battery Technology Dependence: Lithium is the key ingredient in most high-density, rechargeable batteries currently in use or development for EVs and energy storage systems. As the world moves towards electric mobility and renewable energy sources, the demand for these batteries, and thus lithium, will skyrocket.
Low Substitution Potential: While some other metals can be substituted with alternatives depending on price shifts, lithium's unique chemical properties that make it ideal for battery technology are hard to replace. Although research is ongoing for alternative battery technologies, lithium-ion batteries are likely to dominate for at least the near to medium term.
Policy Push: The worldwide policy push towards cleaner energy solutions and the phase-out of ICE vehicles provide a supportive backdrop for lithium demand, unlike other metals that don't benefit from this focused policy attention.
However, while lithium has immense growth potential, investing in the lithium market is not without risks. These include potential technology shifts, policy changes, environmental concerns related to lithium mining, and volatility in lithium prices. Thus, careful research and risk management strategies should be considered when investing.
Tesla is already battery constrained due to Megapack business. I mean, we should already have seen Long Range models of the 3/Y this year based on LFP but no, Megapacks are as profitable utilizing the LFP. However, at least 50% of the shortage will be solved by the ramp of Sodium Ion batteries in the coming years which is better battery for BESS and shorter range vehicle models.
I'll cover sodium ion in a later video
… do you have a graph somewhere which shows the benefit of slow charging versus maximum charging, if there is indeed such a benefit?
I think you mean in terms of cycle life. It doesn't seem to affect it.
What matters is discharge depth and how high you charge it.
That’s nice to know, thank you. I’ve been purposely charging my model three in the garage at < 10 amps, overnight, thinking that this would help out my battery. My intuition was that you don’t get things in life or in physics for free, so you’d have to trade something for a good cycle life & that would be - time.
Todays view of mining for 2028 isn’t Tesla’s view. Tesla is actually planning on upping production to meet their goals. They KNOW it won’t happen without their involvement.
Is the perks the same on TH-cam as patreon??
Honestly should've supported a long time ago. It's so high quality.
The perks are slightly different on Patreon.
The main thing for Patreon and Twitter is that I always try to release the video early there.
I've only done it once here because the TH-cam interface is so clumsy for managing patrons.
Took me a while to not hear "miners" as "minors"😂 was getting really distracted
Lol!