According to cosmologists, three elements formed from the Big Bang, before stars, galaxies or planets. They are hydrogen, helium and lithium.
Lithium’s the 33rd most abundant element in the earth’s crust, far more common than lead, tin, uranium or silver. However, until recently, demand for lithium was quite low.
According to metal price monitor Metalary.com, a ton of lithium cost $1,460 in 2005. By 2010, it rose to $4,350 per ton.
The price really began to take off in 2014. It went from $5,050 per ton that year to $9,100 per ton today.
In just 12 years, the price of a ton of lithium went up 523%.
That’s fantastic. It’s a bull market in lithium. The rapid rise and soaring demand prompted the iconic metals clearinghouse London Metals Exchange to add lithium to its exchange. That would be a huge improvement in the lithium market.
Today, there is no real set price for lithium. The fragmented market crosses countries and industries. That makes it hard to figure out profitability of a mine or a company…
There’s a Lot of Lithium Around
There’s an old trope in the commodity world:
The cure for high prices … is high prices.
The meteoric rise in lithium prices spurred a massive interest in the metal. Companies sprang up all over the world. And they found lithium. Lots of it.
More importantly, they found brine.
As I said earlier, lithium is a common element in the earth’s crust. As mountains weather, lithium metal washes out.
Lithium salt is a common ingredient in brines. A brine is a concentrated salt solution. We find it associated with ancient seas, desert lakes and oil fields. There is a lot of it around.
Mining brine looks like a huge growth area for lithium production.
Brine Mining Isn’t New
MGX Minerals Inc. (CNSX: XMG) is the largest lithium brine permit holder in Canada. The company just launched a new division, called PetroLithium Corp. of America.
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