Unlike the fluctuations observed in 2023, the lithium market in Q1 2024 exhibited greater stability.Lithium carbonate prices, which began the quarter at US$13,377.44 per ton, concluded around US$14,874.31, reflecting an 11 percent increase.
Market oversupply prompted some lithium producers to trim 2024 output targets in hopes that some of the excess would be absorbed in the market.
Spending for project expansions and new developments was also put on the back burner to allow the market to rebalance.
“We believe we are approaching the bottom of the market, considering the industry is moving fairly deep into the cost curve. This is likely to support lithium prices as producers consider further production cuts to balance the market and stem further losses,’ a January report from Fastmarkets read.
Despite some of the challenges the lithium market faced in Q1, the companies profiled below all saw significant gains in 2023. The TSX, TSXV and ASX list was generated using TradingView’s stock screener and data was gathered on April 10. The NYSE and NASDAQ was list was compiled on April 16, 2024. All top lithium stocks had market caps above $10 million in their respective currencies when data was gathered.
Top US lithium stocks
1. Lithium Americas (NYSE:LAC)
Year-to-date gains: 1.49 percent; market cap: US$1.05 billion; share price: US$6.48
Lithium Americas is presently progressing its portfolio of lithium projects, including Caucharí-Olaroz and Pastos Grandes in Argentina, and Thacker Pass in Nevada, USA.
Thacker Pass is considered to have the largest known lithium reserve in the United States and the third largest globally, making it. Key resource in the US ramp up of a domestic lithium supply chain.
In mid-March the lithium company secured a US$2.26 billion loan from the US Department of Energy (DoE) to advance the Thacker Pass project.
“The United States has an incredible opportunity to lead the next chapter of global electrification in a way that both strengthens our battery supply chains and ensures that the economic benefits are directed toward American workers, companies and communities,” said Jonathan Evans, president and CEO of Lithium Americas. “The ATVM Loan … is a significant milestone for Thacker Pass, which will help meet the growing domestic need for lithium chemicals and strengthen our nation’s security.”
The DoE loan is the second large investment into Thacker Pass in the last year. In January 2023, General Motors (NYSE:GM) announced a significant investment of US$650 million in Lithium Americas for the Thacker Pass development.
The funding is the largest publicly disclosed investment by an automaker in a company focused on battery raw materials production. As part of the agreement, GM secured exclusive offtake rights to 100 percent of the lithium production from Phase 1 for a period of up to 15 years, with a right of first offer on Phase 2 production.
Top Canadian lithium stocks
1. Century Lithium (TSXV:LCE)
Year-to-date gain: 78 percent; market cap: C$131.49 million; current share price C$0.89
US-focused Century Lithium is currently advancing its Clayton Valley lithium project in West-Central Nevada. The company is also completing the pilot testing phase at its lithium extraction facility in the state’s Amargosa Valley.
Century Lithium began the year trading in the C$0.48 range and rose to a quarterly high of C$0.80 on March 27.
While the company made no announcements in Q1, some of its positive momentum may have resulted from two press releases from December 2023. The first provides an update on the company’s ongoing feasibility study for Clayton Valley.
“This comprehensive study covers all areas of the lithium extraction process from shallow surface mining of lithium-bearing clay to on-site production of battery-grade lithium carbonate,” the statement reads. “Target production for the study follows that of the project’s earlier Pre-Feasibility Study, which was based on a mill feed of 15,000 tonnes per day and average annual output of 27,000 tonnes per year of lithium carbonate equivalent.”
The second December announcement provides an overview of work at the extraction facility. During testwork at the pilot plant, the company achieved increased lithium grades with an average grade of 7.5 grams per liter lithium.
“This increase in concentration was attributed to the integration of Koch Technology Solutions Li-ProTM equipment into the direct lithium extraction area,” the company said at the time.
2. Lithium Chile (TSXV:LITH)
Year-to-date gain: 50.94 percent; market cap: C$164.97 million; current share price: C$0.80
South America-focused Lithium Chile owns several lithium land packages in Chile and Argentina. Presently, the explorer is working to delineate the deposit at its Salar de Arizaro property in Argentina.
Company shares initially trended down, but ultimately rose 32 percent between January 1 and the end of February.
On February 28, the company released “favorable” results from a new drill hole completed on the northeastern side of Salar de Arizaro, calling them an important step in its roadmap. Hole ARDDH-08 was drilled to a depth of 606 meters, encountering a brine-rich sandy formation at 200 meters. Samples were sent to Alex Stewart Laboratory in Jujuy, Argentina, revealing lithium grades of 180 milligrams per liter at 50 meters and 690 milligrams per liter at 200 meters.
In early March, Lithium Chile penned a farm-In agreement with European mining company Eramet (EPA:ERA). The agreement aims to expedite exploration efforts on four of Lithium Chile’s Chilean properties — Llamara, Aguilar, Rio Salado and Aquas Caliente — with a total land area exceeding 40,000 hectares
3. Power Metals (TSXV:PWM)
Year-to-date gain: 24 percent; market cap: C$55.22 million; current share price: C$0.35
Exploration company Power Metals holds a portfolio of diversified assets in Ontario and Quebec, Canada.
In late February, Power Metals commenced a winter drill program at its Case Lake property in Northeastern Ontario. The program was designed to expand and define lithium-cesium-tantalum mineralization, building on previous work by the company that revealed high-grade lithium and cesium mineralization.
Company shares traded flatly for most of Q1, locked in the C$0.27 range. Prices began to rise in mid-March and hit a three month high of C$0.43 on March 31. The 59 percent uptick coincided with news that Power Metals was acquiring the 7,000 hectare Pelletier project, which consists of 337 mineral claims in Northeast Ontario.
According to the company, the project features lithium-cesium-tantalum potential, with peraluminous S-type pegmatitic granites intruding into metasedimentary and amphibolite formations.
Top Australian lithium stocks
1. Prospect Resources (ASX:PSC)
Year-to-date gain: 46.07 percent; market cap: AU$40.31 million; current share price: AU$0.13
Africa-focused exploration company Prospect Resources holds a diversified portfolio of assets located in Zimbabwe, Zambia and Namibia. Its lithium properties — Omarur and Step Aside — are in Namibia and Zimbabwe, respectively.
Shares of Prospect were locked below AU$0.08 from January to mid-March, before rising to a Q1 high of AU$0.09 on March 25. The move occurred shortly after Prospect acquired a 60 percent residual interest in the Omarur property from Osino Resources (TSXV:OSI,OTCQX:OSIF) for US$75,000, taking Prospect’s stake to 100 percent.
Earlier in the quarter, Prospect announced the start of Phase 2 drilling at Omarur. The company said the program will consist of 70 rotary air blast and reverse-circulation drill holes across 4,250 metres.
2. Ioneer (ASX:INR)
Year-to-date gain: 33.33 percent; market cap: AU$432.96 million; current share price: AU$0.20
Emerging producer Ioneer owns the Rhyolite Ridge lithium-boron project in Nevada, US. According to the company, the project is considered the “sole lithium-boron deposit in North America.”
As part of the permitting process for Rhoylite Ridge, Ioneer completed and submitted an administrative draft environmental impact statement to the US Bureau of Land Management (BLM) in mid-January.
After slipping to a first quarter low of AU$0.10 on January 25, shares of Ioneer spent February and March slowly climbing, reaching a quarterly high of AU$0.17 on March 25. News that the BLM has reached a final decision continued to add tailwinds at the beginning of the second quarter; the results of the review are expected in mid-April.
3. Pan Asia Metals (ASX:PAM)
Year-to-date gain: 28 percent; market cap: AU$26.85 million; current share price: AU$0.16
ASX-listed Pan Asia Metals is a mineral exploration company with a diverse portfolio of projects in Southeast Asia, particularly Thailand. Specialising in critical metals such as lithium, tantalum and rare earth elements, the company is also actively engaged in exploration activities in South America.
Shares of Pan Asia Metals rose to a Q1 high of AU$0.21 during the first week of January. The spike came when the company entered into three binding option agreements to secure ownership of the Dolores North, Dolores South, Pozon and Pink project areas, which together comprise the Tama Atacama lithium brine project in Chile; it also agreed to acquire the Ramatidas project area. In total, these assets span about 120,000 hectares.
“The Tama Atacama lithium project has the potential to be one of the largest lithium brine projects in the global peer group. Surface assays for lithium are extremely high and the project has enviable strategic positioning, with all infrastructure requirements satisfied,” said Pan Asia Metals Managing Director Paul Lock.
Shares subsequently shed some of the positivity, spending the rest of the quarter rangebound below AU$0.17.
FAQs for investing in lithium
How much lithium is on Earth?
While we don’t know how much total lithium is on Earth, the US Geological Survey estimates that global reserves stand at 22 billion MT. Of that, 9.2 billion MT are located in Chile, and 5.7 billion MT are in Australia.
Where is lithium mined?
Lithium is mined throughout the world, but the two countries that produce the most are Australia and Chile. Australia’s lithium comes from primarily hard-rock deposits, while Chile’s comes from lithium brines. Chile is part of the Lithium Triangle alongside Argentina and Bolivia, although those two countries have a lower annual output.
Rounding out the top five lithium-producing countries behind Australia and Chile are China, Argentina and Brazil.
What is lithium used for?
Lithium has a wide variety of applications. While the lithium-ion batteries that power electric vehicles, smartphones and other tech have been making waves, it is also used in pharmaceuticals, ceramics, grease, lubricants and heat-resistant glass. Still, it is largely the electric vehicle industry that is boosting demand.
Is lithium a good investment?
The lithium price has seen huge success over the past year, and many stocks are up alongside that. It’s up to investors to decide if it’s time to get in on the market, or if they’ll try to wait for a dip.
A wide variety of analysts are bullish on the market as electric vehicles continue to prosper, and lithium demand from that segment alone is expected to continue to rise. These experts believe the lithium story’s strength will continue over the next decades as producers struggle to meet rapidly growing demand.
How to invest in lithium?
Unlike many commodities, investors cannot physically hold lithium due to its dangerous properties. However, those looking to get into the lithium market have many options when it comes to how to invest in lithium.
Lithium stocks like those mentioned above could be a good option for investors interested in the space. If you’re looking to diversify instead of focusing on one stock, there is the Global X Lithium & Battery Tech ETF (NYSE:LIT), an exchange-traded fund (ETF) focused on the metal. Experienced investors can also look at lithium futures.
How to buy lithium stocks?
Lithium stocks can be found globally on various exchanges. Through the use of a broker or an investing service such as an app, investors can purchase individual stocks and ETFs that match their investing outlook.
Before buying a lithium stock, potential investors should take time to research the companies they’re considering; they should also decide how many shares will be purchased, and what price they are willing to pay. With many options on the market, it’s critical to complete due diligence before making any investment decisions.
It’s also important for investors to keep their goals in mind when choosing their investing method. There are many factors to consider when choosing a broker, as well as when looking at investing apps — a few of these include the broker or app’s reputation, their fee structure and investment style.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.