Strong demand for lithium continues and that has seen Pilbara Minerals
(ASX:PLS) accept a pre-auction bid (with a small rise in price from September) for a spodumene concentrate cargo ahead of its tenth scheduled digital auction on its battery material exchange (BMX).
It’s the second time this year the company has accepted a pre-auction offer because the demand has been so strong.
Going on price movements since the 5th auction in May, the price in the BMX auction is up around $US2.100 a tonne, or more than 30%.
Pilbara told the ASX yesterday that it had made available a shipment of 5,000 dry metric tonnes (dmt) on a 5.5% lithia basis for sale to a registered group of participants before its planned auction.
The company said it received “strong responses” and accepted a pre-auction offer of $US7,100 ($A11,274) per dmt, equating to an approximate price of $US7830 on an SC6.0 CIF China equivalent basis.
That compares to the September BMX auction price of $US6,988/dmt (SC5.5, FOB Port Hedland basis) which on a pro rata basis for lithia content (and adjusted to be inclusive of freight costs) equates to a price of around $US7,708/dmt (SC6.0, CIF China basis.
In the 5th BMX auction in May, Pilbara accepted the highest bid of $US5,955 /dmt (SC5.5, FOB Port Hedland basis) which on a pro rata basis for lithia content (inclusive of freight costs) equates to a price of approximately $US$6,586 /dmt (SC6.0, CIF China basis).
The successful buyer at the latest auction will pay a 10% deposit “soon”, with Pilbara Minerals to ship the cargo in mid-November.
The buyer and PLS have entered a sales contract requiring an acceptable irrevocable letter of credit to be presented in late October 2022.
The successful buyer will pay a 10% deposit “soon”, with Pilbara Minerals to ship the cargo in mid-November.
The buyer and PLS have entered a sales contract requiring an acceptable irrevocable letter of credit to be presented in late October 2022.
The news saw Pilbara Minerals up 3.4% to $4.96 before they lost ground to end up 0.2% at $4.80.
