Group 1 - The American Battery Technology Company held its Fiscal Fourth Year Quarter and Full Year 2025 Earnings Call, welcoming participants and indicating that a recording of the call will be available on their website [1] - The presentation includes forward-looking statements that are subject to risks and uncertainties, which may lead to actual results differing from anticipated outcomes [2] - The CEO and CTO, Ryan Melsert, will discuss the company's two lines of business: lithium-ion battery recycling and the conversion of claystone to lithium hydroxide [3]

Summary of Key Points from the Conference Call Industry Overview Basic Materials - China - **Copper and Gold Prices**: LME copper price increased by 1.1% WoW to US$9,822/t, while the China price rose by 0.6% WoW to RMB79,450/t, driven by expectations of a rate cut [1][33]. - **Aluminum Prices**: LME aluminum price decreased by 0.3% WoW to US$2,618/t, with the China price slightly increasing by 0.1% WoW to RMB20,730/t [1][44]. - **Gold Prices**: COMEX gold spot price rose by 1% WoW to US$3,407/oz [1][52]. - **Lithium Prices**: Average price of domestic battery-grade lithium carbonate fell by 5.1% WoW to RMB79.7k/t, while lithium hydroxide decreased by 0.8% WoW to RMB76.9k/t [1][56]. Steel Industry - **Steel Prices and Margins**: Rebar price decreased by 0.1% WoW to RMB3,266/t, while HRC price increased by 0.3% WoW to RMB3,466/t. Iron ore price rose by 3% WoW due to expectations of a lower Fed rate [2][64]. - **Cash Margins**: Spot rebar cash margin shrank by RMB55/t WoW to -RMB34/t, and HRC cash margin decreased by RMB28/t WoW to -RMB125/t [2][75]. - **Inventory and Consumption**: Finished steel products inventory increased by 1.9% WoW to 14.7 million tons, and apparent consumption rose by 0.6% WoW to 8.6 million tons [2][85]. Cement Industry - **Cement Prices**: Average national cement price increased by 0.35% WoW to RMB327/t, with a notable increase in Ningxia by RMB30/t [3][88]. - **Demand and Inventory**: Nationwide shipment ratio decreased by 0.6ppt WoW to 41.6%, while inventory ratio was at 60.5%, down 1.1ppt WoW [3][21]. Glass and Paper Industries - **Glass Prices**: National average float glass price decreased by 1.34% WoW to RMB1,189/t due to weak demand [3][99]. - **Paper Prices**: Paper price increased by 0.7% WoW to RMB3,481/t, supported by price hikes from paper mills [3][100]. Solar Materials - **Polysilicon Prices**: N-type polysilicon and granular silicon prices increased by RMB1/kg WoW to RMB51/kg and RMB47/kg, respectively [3][110]. - **Solar Glass Prices**: Prices for coated solar glass remained stable at RMB18.8/sqm and RMB11.0/sqm [3][122]. Additional Insights - **Inventory Trends**: Lithium carbonate inventory at smelters decreased by 11% to 52kt, while downstream inventory increased by 13% to 46kt, leading to a total sample lithium carbonate inventory increase of 3.6% MoM to 142kt [1][60]. - **Market Dynamics**: The steel industry is facing pressure from rising iron ore prices, while the cement market shows signs of recovery despite regional demand declines due to environmental inspections [2][88]. This summary encapsulates the key points from the conference call, highlighting the performance and trends across various sectors within the basic materials industry in China.

Summary of Key Points from the Conference Call Industry Overview - **Industry**: Lithium - **Current Outlook**: The company has shifted from a bearish stance over the past two years to a more optimistic view, calling for higher lithium prices due to supply disruptions in China and potential for further disruptions [2][22][34]. Price Forecasts - **Spodumene Prices**: - CY26: Increased by 32% to US$1,250/t - CY27: Increased by 10% to US$1,150/t - CY28: Increased by 23% to US$1,350/t - Current spot price is US$940/t [2][22]. - **Long-term Price Assumption**: Remains unchanged at US$1,200/t for spodumene [5][22]. Company-Specific Insights Pilbara Minerals (PLS) - **Financial Position**: - FY25 results showed no material changes, with a sector-leading balance sheet of A$599 million in net cash [3][12]. - **Production Guidance**: - Expected production of 880kt at A$590/t FOB, slightly above guidance of 820-870kt [3][12]. - **Future Projects**: - Ngangaju is expected to restart production in FY27, with an optimized DFS for Colina planned for June FY26 [3]. - **Earnings Upgrades**: - Significant EPS upgrades for FY26, FY27, and FY28, with EPS increasing by over 100% for FY26 [10][12]. - **Price Target**: Upgraded to A$2.30/share, a 44% increase from previous estimates [5][12]. IGO Limited (IGO) - **Dividend Outlook**: - Expected to return to healthy dividends in FY26 despite challenges in joint ventures [4][12]. - **Production Challenges**: - Facing write-downs and cash burn at Kwinana, with a disappointing outlook for Greenbushes [4][12]. - **Earnings Upgrades**: - EPS for FY26 increased by over 100% compared to previous estimates [10][12]. - **Price Target**: Upgraded to A$5.75/share, a 20% increase from previous estimates [5][12]. Market Dynamics - **Supply Disruptions**: - Anticipated continued disruptions in Chinese lithium supply, leading to further price increases [22][34]. - **Production Capacity**: - Greenbushes is positioned well for near-term production, with guidance of 1,500-1,650kt SC production at a cash cost of A$310-360/t [34]. - **Long-term Demand**: - Demand for battery materials remains strong, with a focus on electric vehicles (EVs) and battery energy storage systems (BESS) [26][34]. Conclusion - The lithium market is expected to experience price increases due to supply disruptions, with both Pilbara Minerals and IGO positioned to benefit from these changes. Upgrades in earnings forecasts and price targets reflect a more optimistic outlook for the sector moving forward.

Summary of Key Points from J.P. Morgan's Lithium Industry Report Industry Overview - The report focuses on the lithium industry, specifically detailing the export and import data from China for lithium hydroxide (LiOH) and lithium carbonate. Key Insights on Lithium Hydroxide (LiOH) - **Export Decline**: In July, lithium hydroxide exports from China fell by 86% year-over-year (y/y) to 1.2kt compared to 9.1kt in the same month last year. This represents the lowest monthly export level for the year [2] - **Year-to-Date (YTD) Performance**: Net exports for the year to date are 21.2kt, which is 71% lower than the same period last year. Full-year 2024 net exports are projected to be 113kt, down 11% from 2023 [2] - **Historical Context**: FY2023 net exports were 126.2kt, a 40% increase y/y, while 2022 net exports were 90.3kt, which was 29% higher than 2021 [2][4] Key Insights on Lithium Carbonate - **Import Decline**: July lithium carbonate imports decreased by 43% y/y to 13.8kt from 24.2kt in the previous year. YTD net imports are 128.7kt, roughly flat compared to the same period in 2024 [2] - **Future Projections**: Full-year 2024 net imports are expected to be 231kt, a 55% increase compared to 2023. In 2023, net imports were 149.2kt, which was 19% higher y/y [2] - **Price Trends**: The average import price for lithium carbonate decreased by 1% month-over-month (m/m) and 9% y/y in July, averaging $9,987 per ton [2] Price Trends for LiOH and Lithium Carbonate - **LiOH Export Price**: The average export price for lithium hydroxide decreased by 8% m/m and 39% y/y in July, averaging $9,961 per ton [2] - **Lithium Carbonate Price**: The average price for lithium carbonate imports was $9,987 per ton in July, reflecting a downward trend in pricing [2][10] Historical Trade Data - **LiOH Trade Data**: Historical data shows a significant increase in LiOH exports from 2017 to 2023, with a peak in 2023 at 130.0kt, but a projected decline in 2024 [3][4] - **Lithium Carbonate Trade Data**: Similar trends are observed in lithium carbonate, with exports peaking in 2023 at 158.7kt, followed by a projected decrease in 2024 [6][7] Additional Observations - **Market Dynamics**: The significant drop in exports and imports may indicate a shift in market dynamics, possibly due to changes in demand or supply chain disruptions [2] - **Future Outlook**: The projections for 2024 suggest a cautious outlook for the lithium market, with potential implications for pricing and availability [2][4] This summary encapsulates the critical data and insights from the J.P. Morgan report on the lithium industry, highlighting trends in exports, imports, and pricing that are essential for understanding the current market landscape.

Investment Rating - The report provides a "Buy" rating for companies IGO, NST, NEM, CMM, BGL, VAU, WGX, and PNR, while recommending a "Sell" rating for MIN and RRL [4]. Core Insights - The report highlights the potential upside for various companies based on their current pricing and NAV valuations, with IGO showing a 2% downside to its price target and NST having a 14% upside [4]. - The report emphasizes the strong performance of gold and lithium sectors, with specific companies positioned favorably for growth [4][8]. Company Summaries - **IGO**: Rated "Buy" with a market cap of US$2.1 billion, current price A$4.32, and a 12-month price target of A$5.03, indicating a 2% downside [4]. - **NST**: Rated "Buy" with a market cap of US$17.4 billion, current price A$18.56, and a 12-month price target of A$22.53, indicating a 14% upside [4]. - **NEM**: Rated "Buy" with a market cap of US$66.7 billion, current price A$90.58, and a 12-month price target of A$98.83, indicating a 7% upside [4]. - **CMM**: Rated "Buy" with a market cap of US$2.7 billion, current price A$9.44, and a 12-month price target of A$10.09, indicating a 6% upside [4]. - **BGL**: Rated "Buy" with a market cap of US$0.9 billion, current price A$0.93, and a 12-month price target of A$0.97, indicating a 29% upside [4]. - **MIN**: Rated "Sell" with a market cap of US$3.2 billion, current price A$24.44, and a 12-month price target of A$20.30, indicating an 18% downside [4]. - **RRL**: Rated "Sell" with a market cap of US$2.2 billion, current price A$4.53, and a 12-month price target of A$4.24, indicating a 1% downside [4]. Commodity & FX Forecasts - The report includes forecasts for various commodities, with gold expected to reach US$3,503 per ounce in Q4 2025 and lithium carbonate projected at US$8,005 per ton in 2025 [8]. - Nickel prices are forecasted to stabilize around US$7.17 per pound in Q4 2025, while copper is expected to be around US$4.52 per pound [8].

Investment Rating - The report does not explicitly state an investment rating for the lithium industry or specific companies within it [1]. Core Insights - Lithium hydroxide exports from China in May 2025 decreased by 54% year-over-year to 5.6kt, with year-to-date net exports down 70% compared to the same period last year [2][4]. - Lithium carbonate imports in May 2025 fell by 14% year-over-year to 21.1kt, while year-to-date net imports are 15% higher than in 2024 [2][7]. - The average lithium carbonate import price decreased by 23% year-over-year in May 2025, averaging $9,392 per ton [2][10]. - The average export price for lithium hydroxide in May 2025 was $12,093 per ton, down 44% year-over-year [2][10]. Summary by Sections Lithium Hydroxide Trade Data - Exports in May 2025 were 5.6kt, a 54% decrease from 12.0kt in May 2024 [2]. - Year-to-date net exports are 15.1kt, down 70% compared to the same period last year [2][4]. - Full-year 2024 net exports are projected at 113kt, which is 11% lower than 2023 [2][4]. Lithium Carbonate Trade Data - Imports in May 2025 were 21.1kt, a 14% decrease from 24.6kt in May 2024 [2]. - Year-to-date net imports are 98.0kt, which is 15% higher than in 2024 [2][7]. - Full-year 2024 net imports are expected to reach 231kt, a 55% increase compared to 2023 [2][7]. Price Trends - The lithium carbonate import price averaged $9,392 per ton in May 2025, down 2% month-over-month and 23% year-over-year [2][10]. - The lithium hydroxide export price averaged $12,093 per ton in May 2025, reflecting a 15% month-over-month decrease and a 44% year-over-year decline [2][10].

Investment Rating - The industry view for Greater China Materials is rated as Attractive [6] Core Insights - Lithium demand may be pressured by trade tensions, with a market surplus expected to increase to approximately 10,000 tons of lithium carbonate equivalent (LCE) in April, leading to downward pressure on prices [2][3] - Uranium fundamentals remain solid despite a spot price correction, with term pricing stable at around US$80 per pound, indicating a constructive medium-to-long-term supply-demand outlook [3] - Solar glass prices are likely to stabilize due to supply responses, although pressures are expected to persist in the second half of 2025 as demand decreases [4][10] Summary by Sections Lithium - Demand in 1Q25 was stronger than expected due to EV trade-in programs and energy storage system (ESS) demand, but the peak season in 2Q25 is anticipated to be muted due to earlier demand pull-forward [2] - Tariff uncertainties have caused large EV makers to pause April order books, leading to a potential price bottom for lithium carbonate at approximately Rmb65,000 per ton [2] Uranium - The spot price has declined to around US$60 per pound, influenced by uncertainties regarding Russian enriched uranium and US tariffs, but the gap between spot and term prices has widened, limiting further downside [3] - Supply imbalances are expected to gradually reflect in the market, potentially pushing uranium prices higher and benefiting companies like CGN Mining [3] Solar Glass - A reasonable recovery was noted in 1Q25, with prices rebounding due to increased demand from module producers, but a decrease in demand is expected in June as rush installations conclude [4][10] - The near-term supply and demand for solar glass could remain solid, supporting earnings recovery for producers, but increased industry supply may pressure prices again in 2H25 [10] Rare Earth Magnets - An upward trend in rare earth prices is anticipated due to new smelting regulations and tariffs, which could tighten supply from imports, benefiting producers [11] Stock Ratings - Overweight-rated stocks include Xinyi Solar, CGN Mining, and various rare earth magnet producers, with significant upside potential noted for several companies [12][13]

Summary of China Lithium Research Call Industry Overview - The report focuses on the **China lithium industry**, particularly the supply dynamics and production forecasts for lithium carbonate and hydroxide in 2025 and 2026 [2][3][4]. Key Points and Arguments 1. **Increased Supply Forecasts**: - China's lepidolite/spodumene supply is expected to exceed previous expectations, leading to a **5.9% increase in 2025E** and **4.5% increase in 2026E** global lithium supply [2][3]. - The updated forecast for **China lithium lepidolite production** in 2025 is **194kt LCE**, a **22% YoY increase**, significantly higher than the previous estimate of **124kt LCE** [3]. 2. **Inventory Levels**: - As of February 2025, the total lithium feedstock inventory is approximately **1.5 months**, with lithium carbonate inventory also around **1.5 months**, indicating a healthy supply despite strong demand from LFP batteries [2][3]. - Lithium hydroxide inventory remains stable but has a higher inventory duration of nearly **4 months** due to weaker demand for NCM batteries [2]. 3. **Demand Growth**: - China’s lithium demand is projected to grow by **51.9% YoY** in March 2025, with total lithium carbonate and hydroxide output expected to increase by **26% and 29% MoM**, respectively [4]. 4. **Market Dynamics**: - The supply growth in March slightly outpaces demand, indicating a potential shift in market dynamics where supply increases may limit price improvements during peak season [4]. - The report notes that lithium names in China are trading stronger than the lithium price itself, driven by potential catalysts like solid-state batteries [5]. Stock Implications - The report provides a **pecking order** for lithium companies based on their performance and market conditions: - **Qinghai Salt Lake Industry**: Buy - **Tianqi Lithium**: Neutral - **Ganfeng Lithium**: Sell [5]. Risks and Considerations 1. **Upside Risks**: - Stronger-than-expected EV sales and better-than-expected ESS battery shipments could drive demand higher [27][29]. - Potential supply disruptions could also impact market dynamics positively [27]. 2. **Downside Risks**: - An increase in lithium supply could lead to lower prices, especially if demand does not meet expectations [27][28]. - A prolonged downcycle in lithium prices could delay recovery in the sector [28][31]. Conclusion - The China lithium market is experiencing significant changes with increased supply forecasts and strong demand growth. However, the balance between supply and demand will be crucial in determining future price movements and investment opportunities in the sector. The report emphasizes the importance of monitoring inventory levels and market dynamics closely to identify potential risks and opportunities.