Record quarterly production, rising lithium market fuels Pilbara Minerals’ expansion plans

Pilbara Minerals has booked record quarterly production from its flagship Pilgangoora lithium mine south of Port Hedland as prices for its battery-focused product improve significantly (reports The West Australian).
23rd April 2021
Resources Rising Stars

Pilbara Minerals has booked record quarterly production from its flagship Pilgangoora lithium mine south of Port Hedland as prices for its battery-focused product improve significantly (reports The West Australian).

The Ken Brinsden-led miner said in its March quarter update it had achieved record spodumene production in the period of 77,820 dry metric tonnes, which included an annualised run rate of 330,000tpa plant nameplate capacity in January and February.

The surge in production, which was up from 63,712dmt in the December quarter, comes as the company experiences growing demand for its lithium concentrate from existing customers and potential new ones.

The company noted it had received a letter of credit last month ahead of an April 2021 spot sale of spodumene concentrate implying a headline price of $US655/dmt, highlighting the recent strong upward trajectory in pricing.

The price represents a more than 50 per cent jump from last year’s lows.

The improved outlook comes as global auto-makers ramp up plans to expand electric vehicle production and consumers embrace the technology backed by incentives from governments, particularly in Europe.

Independent market analysts Benchmark Mineral Intelligence recently noted that lithium carbonate prices had almost doubled so far this year to $US11,700 per tonne.

Meanwhile, UBS forecasts overall lithium demand will lift 11-fold by 2030, supporting a 17 per cent increase in its long-term forecast prices for spodumene concentrate to $US700 a tonne.

Pilbara said today it had begun work to expand its spodumene production capacity to 380,000tpa in response to the improving market.

Pilbara’s expansion plans coincide with the company taking control of Altura Mining’s operations in a $US175 million transaction with lenders of the failed company last year.

The company noted it had begun trial mining and processing at the neighbouring project in the March quarter, achieving high recovery rates.

Pilbara said it expected to ship 75,000-90,000dmt of spodumene concentrate in the June quarter after exporting 71,229dmt in the three months to the end of March.

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