Lithium pricing at a crossroads

Transcription

1 Lithium pricing at a crossroads v The case for choosing an Argus lithium price benchmark LME Advisory Panel Wednesday 10 th October 2018 London Houston Moscow Singapore Dubai New York Beijing Kiev Tokyo Astana Shanghai Rio de Janeiro Washington DC Riga Calgary Brussels Cape Town Mexico City Berlin San Francisco Sydney Market Reporting Consulting I Events

2 The biggest problem facing lithium today Global lithium output rising, but no industry-wide accepted benchmark 60, percent 50,000 40, percent 30,000 20,000 10, Other Zimbabwe China Chile Australia Argentina

3 Why Argus lithium prices? Argus is a world leading price reporting agency Trusted by companies and governments around the world Argus prices are already used by exchanges (CME, ICE, EEX, etc.) First-class compliance and legal framework Price assessments are produced in accordance with the IOSCO principles for price reporting agencies Deep experience across global energy, metals, fertilizers and chemicals markets, including lithium Decades of experience pricing illiquid markets and niche markets

4 Tracking lithium battery prices since 2013 CNY/T 250,000 LiCO3 (min 99.5%) LiOH (min 56.5%) LiCoO (min 60% Co)* CNY/KG , , , , Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 0 Notes: * - right-hand axis Argus

5 Relevant prices developed for today s market Rationale Lithium carbonate (min 99.5%), cif China, US$/kg Lithium hydroxide (min 56.5%), fob China, US$/kg Most relevant prices for today s market Indicative of spot market values, free from distortion of contract prices, or transfer pricing China provides the most accurate and liquid benchmark for the global parts of supply chain Most logical Argus cif China/ fob China prices Jun Jul Aug Sep 201 Li2CO3 (min 99.5% cif China USD/kg) LiOH (min 56.5% fob China USD/kg)

6 China v

7 China dominates lithium mineral trade Over 95% growth in lithium hydroxide exports from China in 2016 China accounted for 30% of global li carbonate imports in 2017, up 36% from 2016

8 China: largest carbonate importer China s EV drive has underpinned a surge in lithium carbonate imports, which have overtaken Japan and South Korea These new dynamics provide the basis for the Argus 99.5% cif China index (US$) 000t Lithium carbonate imports China S Korea Japan GTIS

9 China: largest hydroxide exporter China has increased its lead as the world s biggest exporter of hydroxide. Japanese imports grew by 110% over the period Argus lithium hydroxide 56.5% fob China (US$) index is a logical next step 000t Lithium hydroxide exports US China Chile GTIS

10 This trend will continue Forecast global alternatively fuelled vehicle (AFV) registrations, mn units China ramping up li production to meet growing demand from the domestic EV sector Supported by Chinese government policies and ambitious targets to accelerate electric vehicle development in the country North America Europe China Other Asia Pacific Other - Argus

11 How Argus prices lithium? Pricing data is processed Collection of pricing data Trained and experienced commodity journalists based in major trading hubs seek price information from a wide range of industry participants. All data is stored electronically, and regularly audited. Argus reporters document the rationale behind each price movement. Global compliance teams monitor daily activities, and carry out rolling internal audits. Filtering and analysis A market appropriate methodology is applied. Our price reporters seek price information related to spot transactions. In the absence of physical trade, we look to firm bids and offers. Pricing data is interpreted Argus reporters make every effort to verify information they receive with the wider market through face to face meetings, and by telephone. Data & information validation, verification and retention policies. Price are published International lithium prices are published weekly alongside detailed explanation of market developments. All price assessments use best practice guidelines in accordance with IOSCO principles for Price Reporting Agencies.

12 Who is using Argus lithium prices?

13 Market engagement and traction Global Reach Four battery focused events in 2018 in all major battery hubs: Attendees Asia LiCoNi in Singapore Europe Over 500 attendees overall From over 250 international companies From leading lithium producers and battery companies Argus Metals Week in U.K. Batteries in Automotives in Germany Agenda USA Argus Metals Week in Las Vegas 85 Speakers From top lithium producing companies And major automotive OEMS

14 Mobile friendly delivery channels

15 Team of experts, with decades of combined experience Alison Tran Nicole Willing Ohmin Zhao David Brooks Stuart Penson Heads up battery materials coverage. 15 years minerals experience. BA from Oxford, and MBA from Insead. Editor of Argus flagship metals publication AMI. Over 10 years experience as an energy commodity journalist. China Metals Editor. Ohmin started his career with Metal Pages in Ohmin leads the Chinese metals team. Based in Beijing. Global Head of Metals, Previously with Metal Bulletin for 15 years, and head of American Metal Market. Senior Editor with over 25 years experience reporting commodity markets. Previously with Metal Bulletin, and later Reuters and Dow Jones.

16 What sets Argus lithium prices apart? Argus unique selling point Geographical lithium pricing point and incoterms Methodology cif China (for li carbonate); fob China (for li hydroxide) Highly focused on most liquid spot market. Designed for today s market US$/weekly (published on Tuesday) Intelligent and robust market assessment informed by regular market survey Experience & industry traction Tracking lithium chemicals since 2013 Decades of experience tracking illiquid and niche market Close to 6000 companies subscribe to Argus services, and approx 2,500 companies subscribe to Argus metal publications alone Not just prices but commentary and forward looking monthly and annual reports Significant resources dedicated to market engagement Regulatory compliance Argus approach to markets coverage is in accordance with IOSCO s Principles for Price Reporting Agencies Argus has been conducting annual assurance reviews since 2013.

17 For more information, please contact: Alison Tran, Business Development Manager Tel: To request a trial of Argus pricing services, please contact: Myles Scott Myles.scott@argusmedia.com Tel: