Lithium In My Head

Hey Influence Traders,

I’ve come down from the mountains.

A group of my insider buddies and I spent time last week testing new military technology … 

It. Was. AWESOME!

Perhaps I’ll throw out some pics soon …

In California, it seemed like every other car was an electric vehicle, which got me thinking about their construction.

Today, China is producing more EVs than any other country.

The West needs to catch up — quickly.

EV Vehicles Need Lithium

Regardless of where they’re produced, EVs rely on lithium batteries.

Lithium is a soft alkali, which is actually the lightest metal — and the lightest solid element, period. (It’s also a pretty great song by the band Nirvana, so try and spot the lyrics.)

Some of my sources are whispering that the #PowerMove to produce lithium will be the next Gold Rush.

Lithium’s uses are critical to green infrastructure and Green New Deal policies, and I anticipate demand to jump as Biden’s plan kicks in.

The ultra-lightweight metal is used to make heat-resistant glass and ceramics, as well as additives to iron, steel and aluminum.

But its primary use is for lithium and lithium-ion battery production.

It also helps energy storage batteries … light my candles in a daze — and, more importantly, is used in digital devices like cell phones, laptops and grid storage.

Since EVs rely on lithium-ion batteries for power, companies that mine or manufacture lithium are … in my head.

The U.S. Is Behind

The U.S. is lagging behind other countries in lithium production, including top producers Australia, Chile, China and Argentina.

In fact the intersection of Chile, Argentina and Bolivia is called the Lithium Triangle because its high-quality salt flats contain more than 75% of known lithium reserves.

In the U.S., Nevada and Wyoming have the largest known deposits.

The only large-scale lithium mine in the U.S. today is the Silver Peak in Nevada, which produces less than 2% of the world’s annual supply.

New production does face up-hill battles.

For example, a new Lithium Americas (Ticker: LAC) project in Nevada is drawing heavy protests from Native American tribes, ranchers and environmental groups.

Lithium Is An Investing Nirvana

While challenges are present, the lithium-ion battery market is on its way to $50 billion.

And I’m not sad … because the U.S. is focused on green energy and these companies are poised to make #Power Moves:

      • Albemarle (TICKER: ALB): This Charlotte, N.C.-based company, which is the world’s leading lithium producer, recently announced plans to expand production to meet expected EV demand.

Its primary operations are in Chile and Nevada, and it will benefit from U.S. infrastructure efforts.

ALB is also the world’s second-largest bromine producer, so it is diversified.

On top of that, ALB has a dividend yield of almost 1%, which is rare in an EV stock.

Its stock price has seen a massive one-year jump, but we have seen just the tip of the lithium iceberg.

      • Livent Corp (Ticker: LTHM): Based in Philadelphia, LTHM is a top-5 lithium producer and a key supplier of lithium to Tesla (Ticker: TSLA), with a deal also pending with BMW (Ticker: BMW).
      • In addition, two companies owned by Berkshire Hathaway (TICKER: BRK.A), Controlled Thermal Resources and Materials Research, are exploring ways to extract lithium from water passing through geothermal plants owned by other BRK.A subsidiaries.

Lithium … I like it, I’m not gonna crack.

Cutting Through the Noise for You.

Frank

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