Neometals lithium spodumene production down 15% in Oct-Dec 2018

Australian lithium miner Neometals produced 15.33% less lithium spodumene year-on-year in the October-December quarter of 2018, the company reported on Wednesday January 30.

The quarter’s output from the flagship Mount Marion asset in Western Australia was 94,000 tonnes of lithium spodumene, compared with 111,023 tonnes produced in the July-September quarter.

Output of higher-grade lithium spodumene (min 6% Li2O) in the three months was 69,000 tonnes, equating to 73.40% of the total.

The remaining 25,000 tonnes of the material produced was lower-grade lithium spodumene (min 4% Li2O), or 26.59% of total production for the quarter.
Shipment volumes of lithium spodumene to offtaker Jiangxi Ganfeng Lithium increased by 2.46% in the December quarter to 93,561 tonnes, from 91,313 tonnes in the September quarter.

The price achieved for minimum 6% lithium spodumene across the fourth quarter was $931 per tonne cfr, according to the agreed pricing formula.

Fastmarkets’ monthly assessment showed the lithium spodumene price at $600-750 per tonne cif China on January 30. This was steady from December but down by 6.89% from $650-800 per tonne on November 28.

Lithium spodumene prices softened at the end of 2018 due to the lower prices reported in China over the course of the year, against which the lithium spodumene prices are calculated.

Fastmarkets’ assessment of the spot price for battery-grade lithium carbonate, min 99.5% Li2CO3, ex-works China, was down by 49.50% to 73,000-81,000 yuan ($10,809-11,994) per tonne on January 24. This compared with 150,000-155,000 yuan per tonne on February 1, 2018.

Divestment agreement, Kalgoorlie lithium refinery
During the December quarter, Neometals agreed to divest its equity interest in Mt Marion to fellow shareholder Ganfeng.

Neometals will sell its 13.8% shares in subsidiary Reed Industrial Minerals to Ganfeng in exchange for A$103.8 million ($74.30 million) in cash and a binding life-of-mine offtake option for 57,000 tonnes per year of Mt Marion’s output of lithium spodumene, min 6%.

Ganfeng currently owns 43.1% of Mt Marion through Reed Industrial Minerals. Mineral Resources owns the remaining 43.1%.

Separately, the final review of the Kalgoorlie lithium refinery front-end engineering and design study is expected in March 2019.

The refinery is expected to have capacity for 10,000 tpy of lithium hydroxide, and commissioning is expected to begin by mid-2021.

Lithium spodumene prices are now included in our free service, Lithium Price Spotlight. See the latest price assessments here.
 

Martim Facada

martim.facada@fastmarkets.com

Published

Martim Facada

January 30, 2019

18:05 GMT

London