In its Q3 2023 earnings report, Piedmont Lithium said it made its first customer shipments under its offtake agreement with its joint-venture operation, North American Lithium (NAL). As a result, the company became a revenue-generating lithium company and recorded adjusted net income of $17 million.
“NAL is the largest operating lithium mine in North America, and production is ramping up well,” said Keith Phillips, president and CEO, Piedmont Lithium. “Our results were materially impacted by the 45% decline in spot lithium prices during the quarter. Virtually all our offtake tonnage will eventually be sold under long-term contracts announced earlier this year, but initial shipments are being made on the spot market.”
The benchmark spodumene concentrate price fell from more than $3,500 per dry metric ton at the start of the quarter to approximately $1,900/dmt today. Piedmont expects to have two shipments in the fourth quarter and the company confirmed its previous full year outlook of shipping approximately 56,500 dmt of lithium concentrate.
“EV demand remains strong globally with unit sales growth of 35% year to date and global EV penetration a record high of 18% in 2023,” Phillips said. “We continue to expect the U.S. electric vehicle market to grow significantly, in part, due to the positive stimulus provided by the Inflation Reduction Act. Further, with battery pack capacity for all EV types increasing and energy storage systems becoming a more substantial factor in the market, the total GWh of new battery capacity deployed has grown by nearly 50% this year.”
In Q3 2023, NAL produced 31,486 dmt and shipped 48,211 dmt, of which 29,011 dmt were sold to Piedmont. In October 2023, Sayona Mining provided a forecast for the one-year period July 1, 2023 through June 30, 2024 projecting production of 140,000 to 160,000 dmt and shipments of 160,000 to 180,000 dmt. NAL has substantially progressed ongoing capital improvement projects, including a capacity increase for its tailings storage facility and a new crushed-ore dome.