Sunday, 26 April 2015

Lithium Market: China Electric Vehicle Industry Report, 2014-2015.


 


  "War On Pollution" in China produces a range of new concepts of electric cars to conquer the largest auto-market in the world. Not all of them will become the hit in the market, but the trend is apparent - EV is the future for mobility in China. Government supports this leap into the lithium based technology to close the gap with western auto-makers. Security of supply for lithium takes the centre stage in the development of strategic industry - electric cars. Tesla Gigafactory has already spiked interest to the lithium batteries and Megafactories are being built now in China by LG Chem, Foxconn, BYD and Boston Power.




International Lithium And Ganfeng Lithium: "The End Of The Lithium 'Big 3'.


  "Joe Lowry has published a very interesting article about the lithium market, major producers and rising Chinese powerhouses in lithium industry. You can find now more details on International Lithium strategic partner Ganfeng Lithium. Apple Electric iCar and Warren Buffet BYD move into energy storage to chase Elon Musk with his Tesla Gigafactory bring Lithium back onto the radar screens of investors now. Read more."

  




China Electric Vehicle Industry Report, 2014-2015



Synopsis
2014 may be called the “first year” of the development of Chinese electric vehicles, with annual sales reaching 74,763, 3.2 times higher than in 2013. With the ascent in the global electric vehicle market, China becomes the second largest market in the world after the United States, eyeing 23.5% market share. Among the top 20 most popular models in 2014, BYD Qin, Kandi K10, Chery QQ3 EV, Zotye E20, BAIC E150 EV and BYD e6 came from China, representing a combined 15.3% share of total sales in the global market.
In terms of market segments:
Almost 34,000 Chinese BEV passenger cars were sold in 2014, surging by 190% year on year; popular models were, in order, Chery QQ3EV, Zotye E20, BAIC E150 EV, BYD E6, JAC iEV4, and Zotye Cloud 100 with their market share totaling as high as 85%. BEV as the ultimate goal of China’s new energy vehicle development will still see new models launched by companies for participation in market competition.
In 2014, China recorded PHEV passenger car sales of 17,500, 123 times that in 2013. In today’s Chinese PHEV passenger car market, there are mainly BYD Qin and Roewe 550 plug-in with the former holding a dominant position with sales of 14,747. In 2015, Chang’an Automobile, Dongfeng Motor, GAC, Volvo, etc. are planning to launch PHEV models, which will intensify market competition. At the same time, companies affected by the policy are expected to turn to the development of EREV (extended range electric vehicle) models.
In the aspect of corporate development, Zotye, BYD, BAIC, Kandi, etc. have made plans for electric car sales target and models in 2015. Among them, Zotye shows the highest target of 80,000 in sales by continuing to rely on its two main models i.e. E20 and Cloud 100 with 50,000 and 30,000, respectively.
As the biggest winner in China’s EV market, BYD sold an accumulative of 20,972 electric cars in 2014, with its market share rising to 28.05%; there are mainly Qin (plug-in), E6 (BEV) and DENZA (BEV, a joint venture brand) in passenger vehicle market, K9 (battery-electric bus) and J9 (heavy battery-electric truck) in commercial vehicle market. In 2015, BYD continues to focus on the passenger vehicle market by launching Tang (Q1, mid-size SUV), Shang (Q2, MPV), Song (Q3, compact SUV) and Yuan (Q4, small SUV) quarter by quarter.
Kandi, a dark horse in China’s EV market, obtained the qualification for producing electric cars with the help of Geely Automobile. In 2014, it posted sales of 10,935, second only to BYD. Concerning its two EV models i.e. Mini K10 and Panda K11, the former is self-produced by Kandi while the latter in the light of Geely Panda. In July 2013, Kandi and Geely were pioneered in China’s “micro-bus” mode in Hangzhou and promoted the business model of by-hour lease which was later copied to Shanghai, Chengdu, Nanjing, Guangzhou, Wuhan, Changsha, Changzhou, etc. in succession. By the end of 2014, Kandi’s micro-bus project has launched a total of 14,398 electric cars.
The New BEV Passenger Car Production Enterprise Investment Projects and Rules on the Production Admission Administration has completed opinion collection in March 2015 and is expected to be introduced within the year. In accordance with the opinion draft, there is hope of loosening electric car production qualification in China, Then parts manufacturing firms (e.g. Wanxiang), internet companies (e.g. Letv), low-speed electric car companies (e.g. Yogomo) and other non-traditional car companies are likely to get the electric car production license, and Chinese electric vehicle market will present the characteristics of diversification.
The report highlights the followings:
  • Policy environment for China’s electric vehicle market;
  • Global and China’s electric vehicle market sales, and sales of main models;
  • China’s electric vehicle market structure and competition pattern;
  • Sales, main models, and import market of two segments i.e. BEV passenger car and PHEV passenger car in China;
  • Major companies in China’s electric car infrastructure and key components;
  • Development of electric vehicle demonstration cities in China;
  • EV development, products, sales, development strategy, etc. of major companies in China."

Commodities, US Dollar and FED: Steen Jakobsen: Get Ready For The Biggest Margin Call In History.



  This warning comes from CIO of Saxo Bank. I found the situation with copper particularly interesting at this point of the economic cycle. If economy is so strong that all markets, apart from commodities, are hitting new ALL-Time-Highs - why Copper is still not participating in this party? It looks like Copper and other Green Metals becoming the win-win proposition now. If economy really has started to grow they will participate, additionally driven by green technology demand. If economy happen to be weak, another round of stimulus will come - this time from China. Infrastructure development will be the key for the future economic growth and demand for metals. Now China is driving it with AIIB and 1 Trillion in projects to spur growth!
  This year will be very interesting with US Dollar sliding below 97.00 last week, after 96.24 the Double Top Reversal will be confirmed and technical crowd will drive it lower pushing commodities higher. Is Oil already indicating this scenario? The money flow in Solar and Lithium Energy Storage from Apple, Google, BYD with Warren Buffett and Tesla will drive the new green metals super cycle.


Copper, Lithium And REE: SunPower And Apple Are Teaming Up To Build Solar Projects In China.


Apple is moving fast into Solar space now and brings attention to the rapid growth in Solar Power installations all around the world. China is particularly important market with its huge air pollution problem. This is where the clean electricity will come from to charge electric cars. With Tesla Gigafactory coming announcement for the home lithium battery to integrate solar installations, this huge segment of growth for the lithium technology will gain further traction. 
  As we have discussed before, Solar Power will be the catalyst for strategic green energy metals: Copper, Lithium and REE. Backed by Warren Buffet China's BYD is another contender to capitalise on the growth in utility storage. International Lithium strategic partner Ganfeng Lithium is taking its part in this growing sector as well with the investment in Boston Power and supplies Lithium materials to the major players in battery industry. 


International Lithium Corp. Commences Drilling at Avalonia Lithium Pegmatite Project, Ireland.





 Molycorp will supply Shin-Etsu Chemical with REE, which will produce REE magnets for Siemens. Like in International Lithium case with Ganfeng Lithium - security of supply for strategic materials is taking the centre stage for advance of the green technology.

Copper's Bright New Age: Solar Electricity Utility Scale And Electric Cars.


"Investment growth in solar electricity is dramatic, and along with wind it will dominate the worldwide energy scene within a few decades. Copper demand will increase because of the growing use of solar electricity. Solar power is among the quickest to build, creates jobs, community benefits, new tax revenue for small towns. Air conditioning and peak energy demands align with when the sun is shining. The USA, China and Germany are aggressively adding solar power. Copper is either the only choice or the quality technology choice for solar parks due to its conductivity, durability, malleability and so on."


  Copper and Lithium become the strategic metals for the ongoing green revolution. Solar and Wind Energy and Electric Cars will drive the new demand for these metals. Solar Energy is growing very fast all over the world now. Energy Storage will be the next step to ignite this growth. This is the new focus of Elon Musk and his Gigafactory. He will introduce the home storage system based on the lithium batteries in the next few months. Copper will have its special place in this mass scale roll out of distributed energy generation systems with Wind and Solar Power. Integral part of this system - Energy Storage is getting popular now with Elon Musk Gigafactory and Warren Buffet with BYD making the headlines. These Trillion Dollar industries: Electric Cars and Energy Storage will drive the demand for Copper and Lithium in the future.

Copper Surges As Freeport Halts Grasberg Mine - The Looming Supply Gap Comes Sooner.


 "Copper is in the very tight supply now and price is surging for the second day. This example just shows that resource nationalism is not going away. Security and diversity of supply will be the key. When Dr Copper will buy into the recovery story? Nobody knows it, but I doubt that FED can start any meaningful rate hikes before Copper will go back above $3.0 mark. FED is not driven by commodity prices, but there is no real growth before commodities will turn up again. Copper takes the particular place now as electrification of our transportation and introducing Solar Power on the mass scale will be driving the demand in years to come. Industry insiders will be our guide as usual here. Just follow the smart money, as this supply gap can be coming much sooner now. Read more."

Backed By Warren Buffett China's BYD Takes Aim At Elon Musk's Tesla Gigafactory In Battery Race.





  "Our industry is getting hotter by the day. After Apple Electric iCar rumours running wild and getting more and more confirmation, we have Warren Buffett stepping into the Lithium Battery Race. Now we have Tesla with its Gigafactory, LG Chem with its Megafactory in China and Boston Power with stake holding by or strategic partner Ganfeng Lithium in Lithium Battery Race. BYD with Warren Buffett backing is making this investment landscape even more exciting. As Elon Musk has said: "All transportation, apart from rockets, will be electric" Read more."

Lithium Technology: Tesla's $13,000 Battery Could Keep Your Home Online In A Blackout.




  The Guardian reports on the coming announcement by Tesla about its lithium battery for home energy storage. Raw materials for lithium battery are already rising in price and it is even before Tesla's Gigafactory and Chinese Megafactories are coming online!


Lithium Hydroxide - A Perfect Price Storm Just Before Tesla Battery Storage Announcement.

  


  Joe Lowry has published another very interesting article on the current supply and demand in the different sectors of the lithium market and the coming shortage for the lithium battery grade materials. If you are interested in our sector - he will be the one to follow on twitter at https://twitter.com/globallithium.  
  Joe has recently brought to our attention the rising powerhouses from China in lithium materials sector and, as you know, I am personally involved with International Lithium and Ganfeng Lithium from China as well. 

 "War On Pollution" in China produces a range of new concepts of electric cars to conquer the largest auto-market in the world. Not all of them will become the hit in the market, but the trend is apparent - EV is the future for mobility in China. Government supports this leap into the lithium based technology to close the gap with western auto-makers. Security of supply for lithium takes the centre stage in the development of strategic industry - electric cars. Tesla Gigafactory has already spiked interest to the lithium batteries and Megafactories are being built now in China by LG Chem, Foxconn, BYD and Boston Power.

The Guardian:

Tesla's $13,000 battery could keep your home online in a blackout


"Elon Musk is a man who likes to make waves. Whether it’s privatizing space exploration or shaking up commuting with the Hyperloop high speed transport system, the billionaire technocrat aims big. Now his electric car company, Tesla, is planning to change the way people power their homes.
In a tweet last month, Musk announced that Tesla would be unveiling a new product on 30 April. It is now widely thought to be a large battery capable of powering a house and an even larger “utility” sized power unit.
Energy supply is a big business and a key market for Tesla, which has spent a fortune developing batteries for its cars. Home batteries can be powered up overnight, when energy companies typically charge less for electricity, and turned on during the day to power a home. They can also be used to store power generated by green - but intermittent - sources like solar and wind. Read more on The Guardian."

Saturday, 25 April 2015

Bix Weir - Silver, Gold And The End Game.



  Not everything is gold, but you can always find some … Coming from very different perspectives a lot of knowledgeable opinions are pointing out the obvious - you cannot print yourself to prosperity and the real value will find the light of day again. It will always be the wishful thinking until the people with the real money will start to buy Gold in thousand of tonnes per year … and this is exactly what China is doing right now.


China bank may have ‘tripled bullion holdings’.



  

  The amount of gold holdings by PBOC is the very important validation of the monetary role of gold. Estimations in the market are as high as 5,000 t or even 30,000 t spread between different Chinese agencies. 


TNR Gold: Shotgun Gold Project Development in Alaska.


 "Nova Gold has published its new presentation for PDAC 2015. Now you can find more information about Alaska as mining jurisdiction and Donlin Gold type of Gold deposit. TNR Gold owns 100% of Shotgun Gold project in Alaska, which has very similar geology to Donlin Gold, according to Greg Johnson - one of the founders of Nova Gold. Read more."


Lithium Hydroxide - A Perfect Price Storm Just Before Tesla Battery Storage Announcement.

  


  Joe Lowry has published another very interesting article on the current supply and demand in the different sectors of the lithium market and the coming shortage for the lithium battery grade materials. If you are interested in our sector - he will be the one to follow on twitter at https://twitter.com/globallithium.  
  Joe has recently brought to our attention the rising powerhouses from China in lithium materials sector and, as you know, I am personally involved with International Lithium and Ganfeng Lithium from China as well. 

 "War On Pollution" in China produces a range of new concepts of electric cars to conquer the largest auto-market in the world. Not all of them will become the hit in the market, but the trend is apparent - EV is the future for mobility in China. Government supports this leap into the lithium based technology to close the gap with western auto-makers. Security of supply for lithium takes the centre stage in the development of strategic industry - electric cars. Tesla Gigafactory has already spiked interest to the lithium batteries and Megafactories are being built now in China by LG Chem, Foxconn, BYD and Boston Power.


International Lithium And Ganfeng Lithium: "The End Of The Lithium 'Big 3'.


  "Joe Lowry has published a very interesting article about the lithium market, major producers and rising Chinese powerhouses in lithium industry. You can find now more details on International Lithium strategic partner Ganfeng Lithium. Apple Electric iCar and Warren Buffet BYD move into energy storage to chase Elon Musk with his Tesla Gigafactory bring Lithium back onto the radar screens of investors now. Read more."

  



Joe Lowry:

Lithium Hydroxide - A Perfect Price Storm


Lithium hydroxide prices are hitting all-time highs in the second quarter of 2015. If you are a believer in the ultimate success of Tesla’s “gigafactory” – you should expect a steady run-up in hydroxide prices until new low cost capacity is built outside of China which isn’t likely to happen anytime soon.
For the past few decades, lithium hydroxide demand has been dominated by use in multi-purpose grease. Demand in the grease market grows at about the global average GDP rate and will continue to be the largest single use for lithium hydroxide for the next two or three years.
In the middle of the last decade, the emergence of NCA cathode use for power tool batteries and later transportation (read: EVs/Tesla) initiated a growth in demand for hydroxide that will ultimately supplant the grease market as the major demand driver for the second most used lithium chemical.
In January, Signum Box estimated global lithium hydroxide demand in 2014 at 31,000MT of lithium carbonate equivalents (LCE) and indicated battery demand was 30% of their estimate or approximately 9,300 MT LCE which is slightly over 10,000 MT stated as lithium hydroxide. That leaves 21,700 MT of LCE or about 23,500 MT of hydroxide going mostly to grease (65%).  Grease makes the world go round - demand is relatively price inelastic. Despite not needing the highest quality product, grease makers will pay what “supply and demand” forces dictate. The other 5% of demand goes mostly to dyestuffs and adhesives (think: “post – it” notes). This demand is also relatively insensitive to price.
Of the 10,000 MT of hydroxide going into battery in 2014, approximately 80% of that demand needs to be of a quality that, as recently as 2012, only one producer (FMC) could make in large quantities. Rockwood has since built a plant capable of producing a certain quantity of high quality product and at least three Chinese producers now can produce limited but growing quantities of high grade material.
Based on recent expansions, China has more than 40,000 MT of hydroxide capacity. Capacity outside China is slightly less than 20,000 MT. Simple math – the world has almost 60,000 MT of capacity and currently only 31,000 MT of demand. Why is price going up? Despite sufficient lithium hydroxide capacity in total, the capacity capable of supplying the rapidly growing battery market is limited and only growing in China. China is the high cost hydroxide producer and exporters pay a VAT penalty vs their "western" competitors.
China hydroxide capacity is divided among several suppliers and is based on the conversion of spodumene ore supplied primarily from Australia.  The average cost of hydroxide production in China is more than 50% higher than the cost of production by Albemarle/Rockwood but only slightly higher than the cost at FMC based on FMC’s issues the past few years in Argentina and North Carolina. SQM does not compete in the "high end" of the hydroxide market. In addition to the cost difference, China exporters cannot recoup the 17% VAT added to their exports. Going forward since the spodumene ore supply is controlled by the Tianqi/Albemarle Talison JV; spodumene price can only be expected to rise. Both Tianqi and Albemarle have made very expensive investments in their lithium assets and are under pressure to show reasonable ROI.
In 2014, Tesla’s actual hydroxide demand for the production of ~35,000 cars was only about 1,700 MT – still relatively insignificant. Tesla’s battery supplier sourced hydroxide at a much higher rate than current car production based on growth forecasts; however the reality is that hydroxide price has reached all-time highs BEFORE a significant impact from Tesla growth and the "gigafactory".
The “gigafactory” will require somewhere between 25,000 and 30,000 MT of lithium hydroxide when running at full capacity – hopefully in four or five years. The lower end of the estimated range assumes cell chemistry and raw material utilization improvements. In any case, Tesla’s projected demand would almost double demand by the end of the decade.
Neither Albemarle/Rockwood nor FMC have been willing to start construction of new hydroxide capacity based on demand forecasts from Tesla. Why invest capital in a project that will only serve to push price down if “gigafactory” demand  doesn’t materialize? FMC doesn’t have enough carbonate capacity to feed additional hydroxide capacity so they would need to expand carbonate and hydroxide or source carbonate from a competitor  in an increasingly tight carbonate market – neither scenario is attractive to them absent Tesla commitments.  It seems until Tesla is willing to contribute capital or provide “take or pay” contracts they will have to hope that Chinese companies keep expanding or a junior miner like Nemaska is successful. The former scenario is quite likely and will ensure high cost lithium hydroxide is dominant source of raw material for the "gigafactory". The latter scenario is highly unlikely.
A large grease market growing at GDP combined with a base lithium ion battery market growing in the 15-18% CAGR range plus the addition of the Tesla “gigafactory” demand seems to set the stage for continued upward price movements. Look for $11,000 to $12,000/MT average hydroxide price before you see new capacity in the western hemisphere."

Koos Jansen: China SGE Gold Withdrawals 50 Tonnes In Week 15, Total 731 Tonnes for 2015.




China continues to accumulate Gold in record amounts and Russia has joined it last month as well.



China bank may have ‘tripled bullion holdings’.


  

  The amount of gold holdings by PBOC is the very important validation of the monetary role of gold. Estimations in the market are as high as 5,000 t or even 30,000 t spread between different Chinese agencies. 


TNR Gold: Shotgun Gold Project Development in Alaska.


 "Nova Gold has published its new presentation for PDAC 2015. Now you can find more information about Alaska as mining jurisdiction and Donlin Gold type of Gold deposit. TNR Gold owns 100% of Shotgun Gold project in Alaska, which has very similar geology to Donlin Gold, according to Greg Johnson - one of the founders of Nova Gold. Read more."




China’s First Home-Grown Electric Sports Car.


"A Chinese company’s new electric sports car is aimed at the luxury end of the market, currently dominated by European brands. The WSJ's Colum Murphy reports."


  "War On Pollution" in China produces a range of new concepts of electric cars to conquer the largest auto-market in the world. Not all of them will become the hit in the market, but the trend is apparent - EV is the future for mobility in China. Government supports this leap into the lithium based technology to close the gap with western auto-makers. Security of supply for lithium takes the centre stage in the development of strategic industry - electric cars. Tesla Gigafactory has already spiked interest to the lithium batteries and Megafactories are being built now in China by LG Chem, Foxconn, BYD and Boston Power.


International Lithium And Ganfeng Lithium: "The End Of The Lithium 'Big 3'.


  "Joe Lowry has published a very interesting article about the lithium market, major producers and rising Chinese powerhouses in lithium industry. You can find now more details on International Lithium strategic partner Ganfeng Lithium. Apple Electric iCar and Warren Buffet BYD move into energy storage to chase Elon Musk with his Tesla Gigafactory bring Lithium back onto the radar screens of investors now. Read more."

  


The Wall Street Journal:

Executive Shows China’s First Home-Grown Electric Sports Car


BEIJING—In a quiet technology park near the Chinese capital’s airport, a former Beijing Jeep executive is completing a plan to create China’s first homegrown electric sports car. 
Lu Qun’s idea: design and build a battery-powered sports car that is cheaper than imported European gasoline-engine roadsters. If successful, Mr. Lu’s first car would go into production in late 2016 and challenge similar models from much bigger foreign companies. 
His CH-Auto Technology Co. has a track record. It has designed gasoline-powered cars for Chinese manufacturers including Zhejiang Geely Holding Group, Jiangling Motors Corp. and a Dongfeng Motor Group. joint venture. Read more on WSJ."