Australia's WesCEF to pursue Li plans despite hurdles

  • Spanish Market: Battery materials, Metals
  • 03/05/24

Australian conglomerate Wesfarmers will still pursue the strategy for its chemicals, energy and fertilisers arm (WesCEF) to be an integrated lithium producer, despite the recent lithium market downturn.

Wesfarmers earlier this year warned of unprofitable lithium sales from its Mount Holland project, owing to high production costs as it goes through a ramp-up. But WesCEF plans to weather through the downturn and plow ahead with its lithium downstream developments, given strong long-term fundamentals and despite the market's immaturity and cyclical demand, according to the group's executives on 2 May.

Spodumene prices in China — which dominates global consumption of lithium raw materials — were assessed at $1,080-1,180/t on 30 April, down sharply from $5,750-5,900/t at the start of 2023.

"It's also worth remembering that when we invested in Covalent and took the final investment decision, lithium hydroxide prices were lower than they are today," said WesCEF's managing director Ian Hansen.

Wesfarmers and Chilean lithium firm SQM jointly own Australian firm Covalent Lithium, which looks after the Mount Holland project that includes a mine, concentrator and its 50,000 t/yr Kwinana lithium hydroxide refinery.

Completing the refinery's construction and commissioning remains WesCEF's priority, with the mine and concentrator going through a ramp-up, according to WesCEF. The firm is also progressing its potential expansion project for the mine and concentrator, which it submitted an application for environmental approvals. The first lithium hydroxide output out of the Kwinana refinery is still expected in the first half of 2025, with a delay in timeline.

Covalent completed its first spodumene concentrate shipment earlier in March, said WesCEF. Wesfarmers expected its share of spodumene concentrate output from Mount Holland to be 50,000t in the current July 2023-June 2024 fiscal year. The share will rise to 150,000-190,000t in the upcoming July 2024-June 2025 fiscal year.

Lithium downturn

The lithium downturn has led to multiple firms, including major particpants across the lithium and battery supply chain, reporting poor January-March results.

Australian lithium and nickel producer IGO, affected by slumps in the lithium and nickel markets, reported its first quarterly loss in years while posting lower output. Major US lithium producer Albemarle's executives have also called the market "unsustainable" in the long run, as it posts a whopping $1.1bn year-on-year fall in sales from its energy storage division.

Major Chinese lithium producer Tianqi Lithium also suffered heavy losses, while global lithium firm Arcadium Lithium earlier this year cut its planned sales numbers this year and warned that current market prices will weigh on future supply.

South Korea's top battery manufacturer LG Energy Solution (LGES) reported W157bn of operating profit in January-March, but would have reported an operating loss of W32bn if it did not receive almost W189bn in US Inflation Reduction Act tax credits.


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14/06/24

FAA, EASA probe Boeing, Airbus Ti parts

FAA, EASA probe Boeing, Airbus Ti parts

Houston, 14 June (Argus) — The US Federal Aviation Administration (FAA) and the European Union Aviation Safety Agency (EASA) are investigating whether falsified documents were used to verify the authenticity of titanium used in parts manufactured by Spirit Aerosystems and others for Boeing and Airbus jets. The US probe arose after Boeing alerted the federal regulator that material was procured through a distributor "who may have falsified or provided incorrect records," the FAA told Argus . The FAA is looking into the scope and impact of the issue. The EASA was notified by the Italian Civil Aviation Authority (Enac) of the issue and has subsequently started an investigation to determine if the traceability issue also has safety implications, an EASA spokesperson told Argus . There is currently no evidence of a safety issue in the fleet, it added, but it will investigate the root cause and monitor new developments. "This is about titanium that has entered the supply system via documents that have been counterfeited," a Spirit spokesperson told Argus . Boeing added that the issue affected some titanium shipments received by a "limited set of suppliers," including its fuselage maker Spirit, and relates to a "very small number of parts" on any of its aircraft. Boeing declined to specify on which programs and for what components the titanium in question was used, but it said the correct titanium alloy was used. Affected parts were produced from 2019-2023, Spirit said. Boeing is removing suspect parts on its planes before delivering them to customers for compliance purposes, but confirmed its in-service fleet is safe to operate based on an internal analysis, it said. Airbus confirmed the airworthiness of its A220 aircraft after conducting "numerous tests" on parts coming from the same source of supply, and said it is working in close collaboration with its supplier, an Airbus spokesperson told Argus . Spirit removed the units from production and performed over 1,000 tests to ensure the "mechanical and metallurgical properties" of the titanium continued to meet airworthiness standards. Spirit supplies an array of parts to Airbus and Boeing including fuselages, pylons, and wing structures. Titanium alloys are typically used in engine components such as turbines and compressor blades, landing gears and fasteners. Aerospace companies including Airbus and Boeing earlier this year formed a coalition to help prevent unauthorized parts from entering the supply chain. It followed actions taken by CFM International, and its parent companies GE Aerospace and Safran Aircraft Engines, last years in response to engine parts sold by British distributor AOG Technics with forged documents. By Alex Nicoll and Samuel Wood Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

S Africa's ANC, DA agree to form government


14/06/24
14/06/24

S Africa's ANC, DA agree to form government

Cape Town, 14 June (Argus) — South Africa's African National Congress (ANC) and Democratic Alliance (DA) political parties today agreed to form a government while the first sitting of the new parliament was underway. The agreement, which includes the Inkatha Freedom Party (IFP), paves the way for ANC leader Cyril Ramaphosa to be re-elected president. The parties will assume various positions in government broadly in proportion to their share of seats. The government of national unity (GNU) agreement is the result of two weeks of intense negotiations after the ANC lost its long-held majority in the national election on 29 May. It secured 40.2pc of the vote, and the centre-right, pro-market DA retained its position as the official opposition with 21.8pc. The deal scuppers the possibility of an alliance between the ANC and the two largest left-wing parties, MK (uMkhonto weSizwe) and the Economic Freedom Fighters (EFF), which credit ratings agency Fitch warned could pose risks to macroeconomic stability . MK party unseated the EFF in the election to come third, winning 14.6pc of the vote. The EFF secured 9.5pc, and the IFP came a distant fifth with 3.85pc. The MK and EFF are populist parties that campaigned on agendas including wide-scale land expropriation without compensation, nationalisation of economic assets — including mines, the central bank and large banks and insurers — halting fiscal consolidation and aggressively increasing social grants. The GNU parties agreed the new administration should focus on rapid economic growth, job creation, infrastructure development and fiscal sustainability. Other priorities include building a professional, merit-based and non-partisan public service, as well as strengthening law enforcement agencies to address crime and corruption. Through a national dialogue that will include civil society, labour and business, parties will seek to develop a national social compact to enable South Africa to meet its developmental goals, they said. The GNU will take decisions in accordance with the established practice of consensus, but where no consensus is possible a principle of sufficient consensus will apply. By Elaine Mills Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Inpex invests in Australian solar, battery project


14/06/24
14/06/24

Inpex invests in Australian solar, battery project

Tokyo, 14 June (Argus) — Japanese upstream firm Inpex has decided to invest in a hybrid solar and battery project in the Australian state of New South Wales, aiming to boost its renewable energy business abroad. Inpex reached a final investment decision on the Quorn Park Hybrid project in Australia, a joint venture project with Italian utility Enel's wholly-owned Australian renewable energy firm Enel Green Power Australia (EGPA), the Japanese firm announced on 14 June. The project consists of solar farm construction and power generation with a photovoltaic and battery system. Batteries are usually a necessary back-up power source to stabilise power grids that utilise renewable energy. The project aims to produce around 210GWh/yr from solar power with around 40MWh/yr from battery storage, according to EGPA, with an operational capacity of around 98MW for solar and 20MW for battery. The firms plan to start construction during the second half of 2024, before it starts commercial operations during the first half of 2026, according to an Inpex representative that spoke to Argus . The Japanese firm did not disclose the investment amount but the investment value for construction of the project is estimated at "over $190mn", according to EGPA's website. Inpex bought a 50pc stake in EGPA in July 2023, with an aim of expanding its renewable generation portfolio. The firm regards Australia as a "core area" for boosting its renewable energy business, according to Inpex. By Yusuke Maekawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Japan’s scrap export tender slips in June


13/06/24
13/06/24

Japan’s scrap export tender slips in June

Singapore, 13 June (Argus) — The monthly export tender of Japanese scrap dealer co-operative Kanto Tetsugen for June settled lower compared with May but remained above recent market levels, providing support to the export market and prices. The June tender concluded at an average of ¥51,364/t ($327.20/t) fas for 25,000t of H2 scrap, a fall of ¥1,226/t from May. This brought the fob price to an equivalent of ¥52,364/t or $333.60/t. The first 10,000t settled at ¥51,510/t with the second 15,000t at ¥51,267/t. The two shipments are expected to head for Vietnam and Bangladesh. Several market participants expect the export market to be supported, despite the tender result concluding lower against May, as it was above recently traded levels. The export market has faced significant downwards pressure over the past month, with the H2 fob price falling by ¥2,400/t because of sluggish demand and low price expectations from Taiwanese and Vietnamese buyers. The Argus H2 fob Japan assessment was ¥50,200/t on 12 June, while the May monthly average was ¥51,381/t fob Japan. The latest tender price aligns with the domestic price in the Kanto region, which may become the new target price for exporters. The H2 collection price at Tokyo Steel's Utsunomiya plant was ¥51,500/t delivered to the steel mill. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US Fed signals one rate cut this year


12/06/24
12/06/24

US Fed signals one rate cut this year

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