Lithium juniors outperform on expected future demand – by Henry Lazenby (MiningWeekly.com – April 19, 2016)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – In the wake of Tesla Motors’ introduction of the ‘Model 3’ mass-market electric vehicle (EV), lithium development and exploration company share prices have exploded.

This was despite Tesla not having sold (or even built) a single Model 3 yet. Tesla would also not have it on the road for years, and the company continued to haemorrhage money, according to Chris Berry, writer of the Disruptive Discoveries Journal.

“The $1 000 refundable reservation fee is simply a free option for a potential car buyer and gives Tesla an opportunity to defray dilution,” he stated in a recent market commentary. Berry noted that in the wake of this news, lithium developers were “making hay while the sun shines” through some truly impressive capital-raising efforts.

According to his year-to-date estimates, the lithium mining industry had raised a collective $198-million with multiple offerings oversubscribed. “For an industry that only generated $1-billion in revenues last year, this is impressive. Especially when you consider the overall funk in the commodity sector and that no major lithium producer is included in this total,” Berry advised.

It also appeared that lithium majors outside of China were positioning for accelerated demand with the joint venture announcement between NYSE-listed SQM and TSX-listed Lithium Americas, for example.

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