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π― Lithium in Focus: Should You Buy New Gold?
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More than 70% of this metal is used in the production of batteries for modern devices. Musk generally stated that today mining
lithium is the same as printing money. And Elon wonβt talk in vain: the main consumer of
lithium has become electric cars, in which an average of 8 kg of metal is consumed per battery.
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Along with the popularity of electric vehicles, production quadrupled from 2010 to 2021, but production still lags behind demand, so
lithium prices have increased by 510% since May 2021.
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Lithium is a highly sought-after metal, but it takes several years to launch new production. This industry is dominated by forward transactions β as a rule, the mine has not yet produced a single gram of metal, and the company already has a contract, for example, with BMW until 2027. As a result, overly active investing begins to put pressure on market prices.
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The current centres of lithium production are located in Australia (more than 50% of the world's volume) and China. The market is already experiencing oversupply and inventory, and the Chinese auto industry, boosted by subsidies, could create serious logistics and financial problems.
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Lithium prices are volatile and it is difficult to predict at what levels they will stabilize.
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However, due to the frantic growth in demand for EV cars, the long-term prospects for
lithium are very strong, and the current correction can be considered a profitable entry point.
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It is worth forming a position in lithium companies, for example, in the Chilean Sociedad QuΓmica (NYSE: SQM), the American Albemarle Corp. (NYSE: ALB) and Livent Corp. (NYSE: LTHM), unforgettable about the Chinese β Ganfeng
Lithium (SHE: 002460), Sichuan Yahua Industrial Group (SZSE: 002497), and Australians β Pilbara Minerals (ASX: PLS), Mineral Resources Limited (ASX: MIN). TOP 10 also includes Canadian
Lithium Americas Corp. (NYSE: LAC).
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We expect the first global upward impulse at the beginning of next year.
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Profits to yβall!