We’re going to do that unattractive thing again. Prance our egos around as we say we told you so.
Core Lithium has stopped mining and has warned of a big write-down on the value of its assets as the collapse in the battery material’s prices takes a heavy toll on Australian producers.
The Northern Territory’s only lithium producer told investors on Friday that it would revert to processing stockpiled ore and suspend operations at its Grants open pit mine.
There’s nothing particularly wrong with this Finniss mine. New, well made, decent deposit, they’ve been producing, the material is up to specification. It’s a fine lithium mine in fact. It’s also, as you can see, now closed.
For the lithium price is now below production costs. Which is one of those really pretty big signals that there’s no lithium shortage.
As we said back in September in fact.
There’s a list out there of some 300 would be lithium mining companies. For that’s what the market response has been - the lithium price rises, men with hammers go out to tap the world. And, amazingly, given that lithium is not in short supply, only in currently short extraction, they find it. The value of lithium in the ground falls further and faster than this 75% fall in the purified stuff too. The share prices of those would be lithium miners are falling - globally and near in unison. Because we’ve found enough and it only took a couple of years. It was also done without politics or even subsidy.
And a year ago. And 18 months ago.
It simply is not true that there’s a shortage of these critical minierals - not in any real sense of there not being enough atoms around. Nor in the sense of there not being enough mineable atoms around. There can be, sometimes is, a shortage of open holes in the ground that people are currently extracting them from. But we’ve a system to deal with that - prices. Prices go up more people dig holes. Supply increases, prices come back down. As the man said, the cure for high prices is high prices.
Now, if that were all then it wouldn’t be worth remarking upon. But every government and non-government is mithering about supplies of critical minerals. The UK govt, the one you and we pay for, has taskforces and ministerial reports about them. Of less than, as one of says elsewhere, sensible activity. The US, the EU and everyone else we’ve noted have similar wastes of bureaucratic egghead time and effort. The WEF and any number of NGOs have teams working on this same non-existent problem.
There is no shortage of minerals and the shortage of holes is cured by prices. There, we’re done.
So, could we please disband all these task forces? Gralloch the bureaucracies and ignore the NGOs? We don’t have a problem and we’ve solved it anyway - with that old one of liberty, markets and prices. As so many problems can be and as so many bureaucratic structures adamantly fail to recognise.
That last is at least understandable, you know, Upton Sinclair. But that’s no reason for us all to allow them to get away with it. So, let’s not.