Chris Berry: Consolidation and M&A Coming to the Lithium Space in 2018
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Chris describes his background in capital markets and how why he decided to become an independent researcher into rare earth and energy metals. He felt that the small sector was being ignored by institutions and there was going to be increasing demand for these metals. He says it was dull for the first few years, but now things are really picking up.
The lithium market has responded positively to the increase in price over the past year. There is continuing demand from China. Many people are just beginning to understand this market and how it relates to the electric vehicles. The coming months will be positive for investors.
There is a powerful economic tail-wind in play right now. Battery technology and prices are continuing to get cheaper. Solar, wind, and batteries are all getting more affordable and as technology improves the energy metals look increasingly promising.
China usually does what they say they will do, and they want seven million new vehicles on the road by 2025. That alone will increase lithium demand from 215k tons to over 300k tons. He feels E.V. demand will center around China and their desire to clean up air quality.
Investment interest is still lagging, and there is much room for growth. As underlying commodity prices improve, the stocks and market caps are likely to perform well.
Mr. Berry expects that the general theme for 2018 will be one of consolidation and acquisitions as major companies look for long-term supply. He discusses various companies that can provide good pure exposure to the market.