The Electric car market has shown enormous growth in recent years. As the world moves towards an era of EVs, the demand for their raw materials has soared in parallel. Electric vehicles are powered by lithium-ion batteries, making lithium a key resource in the production of EVs. What makes this shiny metal even more interesting is the scope of its use. The use of lithium is not only limited to the automobile industry. It is the power cell for the majority of smartphones and other electronic gadgets in use nowadays. This bloom in lithium-ion batteries’ demand has attracted many investors, and they are constantly looking for ways to get their hands on this valuable commodity.
7 Canadian Lithium Stocks You Should Invest In
For Canadian investors interested in jumping the gun on lithium stocks, here are seven stocks that have the most promising future.
Lithium Americas (TSX: LAC)
Lithium America Corps is one of the most prominent names in the lithium mining sector. Founded in 2007, this Canada-based company is currently focusing on developing two lithium projects; one in Argentina and the other one in the United States. Their rapid development of the Cauchari-Olaroz lithium brine project in Argentina, which is the third-largest lithium brine deposit in the world, has poised them to become a major player in the lithium production sector. Apart from that, the Thacker Pass Lithium Project, owned 100% by lithium America, is well on its way to becoming the largest lithium producer in the United States. This American Lithium project is expected to have an annual production capacity of more than sixty thousand tons.
Lithium Americas has partnered up with Ganfeng lithium, the leading manufacturer of lithium products in China. Owing to a growing demand for electric vehicles in China, the prospects look bright for Lithium Americas. This clear business model makes them an ideal company to invest in.
Within only the last five weeks, Lithium Americas Corporation has witnessed a growth of 35% in its stock value, turning heads all around the stock market. At this moment, it is ranked second on the list of top metals on TSX. Trading at $21.49 as of 16th August, 4:29 am, this stock is expected to grow even further in the upcoming months. Moreover, the healthy stock trades volume of 691,000 hints at the sustainability of this lithium stock, making it an ideal stock to invest in.
Standard Lithium (TSX.V: SLI)
Founded in 1998, Standard Lithium is a mining company that uses cutting-edge technology for the exploration and mining of lithium and other minerals. The company has two major products under development as of now. Their flagship lithium brine project, the “Lanxess Project,” is being developed near El Dorado, Arkansas, home to the United States’ largest brine processing facility. The abundance of industries in Arkansas, coupled with the availability of the infrastructure required for exploration and development there, has tipped Lanxess Project to become hugely profitable.
Another lithium project in San Bernardino County is also under construction. The 45,000-acre Bristol and Cadiz dry lake lithium project is still not fully developed, but it will prove to be a game-changer once it’s up and running.
Although still a venture capital stock, the stocks of Standard Lithium have spiked in valuation. The valuation has increased by a massive 430% in the last year, and the stock prices are growing without an end in sight. If the lithium demand forecasts are true, it is safe to bet that Standard Lithium won’t be running low on profits any time soon. This stock is currently trading at $8.8 on August 17th, 6 am PDT. Considering the size of the lithium-dependent industry, coupled with a burgeoning lithium demand, you won’t regret investing in this stock.
Rock Tech Lithium (TSX.V: RCK)
The global push for cleaner energy has enticed several industries to look for environmental-friendly sources of minerals. Rock Tech Lithium is turning up to the challenge. The Vancouver-based company has set its eyes on lithium hydroxide production; if it succeeds in doing so, it will be one of the first lithium hydroxide producers outside China. The company aims to start lithium production by the start of 2023. Market watchers have foretold that the economic assessment of rock lithium deposits is highly optimistic.
The company is counting on the high-quality spodumene deposits in the Georgia Lake Area near Ontario to produce battery-grade lithium. The company has also planned to erect a lithium hydroxide converter in Europe, which will be instrumental in supplying lithium to European electric vehicle manufacturers. Supply chain experts have predicted that lithium from Chinese miners to European manufacturers is not sustainable in the long run. Nevertheless, this is a clear business model for North American and European lithium manufacturers, and Rock Tech plans to capitalize on this market.
With the common shares issued and outstanding reaching the 60 million mark, investors are lining up to buy Rock Tech stocks. The stock is currently trading at $5.30 on August 17th (10:56 am PDT), making this a good time to invest in this promising stock.
Orocobre Limited (TSX: ORL)
Orocobre is a global supplier of minerals that excels in the production of boron and the development and supply of battery-grade lithium carbonate. The flagship project of Orocobre, Olaroz lithium, is set to complete its stage 2 expansion, taking its annual lithium production to 42,500 tons per annum. Furthermore, its partnership with Toyota Tshushu, part of the Toyota group, means a booming market for its lithium resources. Another interesting aspect of this investment is Orocobre’s likely merger with Galaxy Resources, scheduled for 26th August. The merger will position the new group as one of the top 5 lithium producers and developers worldwide, with projects spread all over the globe, from Japan to South America.
On August 10, the share price of Orocobre Ltd was at an all-time high of$9.51. The Orocobre stock price has doubled in 2021, signalling the increasing interest of investors in this company’s lithium ventures. The stock price of Orocobre Ltd is currently trading at $8.38 (11:56 am Ptd), with a share volume just short of the 100k mark. With an impressive market cap of $2.8 billion, now is the best time to invest in Orocobre Ltd.
Global Battery Metals (TSX.V: GBML)
Another emerging name in the lithium development industry is the Global Battery Metals. Formerly known as Redzone Resources Ltd, this Vancouver-based company is one of the most promising penny stocks on the TSX.
Global Battery Metals has set its eyes on three projects at the moment: the Leinster Lithium project in Ireland, Lara Property in Peru, and Lithium King in the Pilot Valley of Nevada. Leinster Lithium Project is being developed in an area that boasts high-grade lithium and better conditions for lithium acquisition. In addition, there are several places where high-quality deposits of spodumene (ore that bears lithium) are abundant. The company has the option to acquire 90% of the North-West Leinster Lithium Property, where it plans to increase lithium exploration and development. Global Battery Metals also owns a stake of 55% in the Lara Property of Peru, where Minsur is building a $1.3 billion mine.
Currently trading at $0.27 (12:30 pm Ptd), this stock has massive growth potential. Despite being a penny stock, analysts predict that the ongoing development of lithium projects will act as a catalyst for this stock’s growth.
Neo Lithium (TSXV: NLC)
Neo Lithium is another lithium development company that excels in the development of low impurity, high-grade lithium. They produce 99.9% battery-grade lithium carbonate, which is the highest quality lithium carbonate produced to date. They have done so using their upgraded alkali methodology. Their current plant works in batch mode, which the company will soon convert into a continuous mode to keep up with the lithium demand. Their business model is sustainable, and with a market cap of $627 million, it is undoubtedly standing out from the crowd. With the rapid increase in Lithium demand across Europe, Neo Lithium will likely prove to be a key player in this emerging industry.
The flagship project of Neo Lithium is the 3Q Lithium Brine Project. This project is located in the Lithium Triangle of Argentina, known for housing more than 40% of the lithium reserves. Neo lithium controls 100% of this project and supervises the development of all lithium resources. In addition, there is no aboriginal or native population in this area, making it a mining-friendly project that is sustainable in the long term.
With an impressive maximum yield of 100 lts/sec, the 3Q Lithium Project is equipped to keep up with the lithium demand of Europe. Trading at $4.44 on August 18 at 7:08 am PDT; it is a promising lithium stock for Canadians.
E3 Metals (TSXV: ETMC)
E3 Metals is a lithium development company with more than 7 million tons of LCE (Lithium Carbonate Equivalent) inferred mineral resources. Within 1 year, the stock price of E3 Metals has risen by a whopping 444%. The company has done well to cope with the economic recession caused by the Coronavirus outbreak. The company has a state-of-the-art proprietary extraction method that converts impure lithium reserves into battery-grade lithium, ready for industrial use. E3 Metals uses direct lithium extraction technology and aims to eliminate its carbon footprint within the next few years.
E3 Metals plans to extract pure lithium from the lithium-enriched brine 2500 meters below the surface in the famous Leduc Formation in Alberta. The company has recently graduated to the Tier 1 of the TSX Venture Exchange. Stock analysts are predicting an influx of investments to follow suit. The company is partnered with the University of Alberta for research and development in its future projects. In addition to this, the company has also secured funding from the NSERC, Alberta Innovates, and GreenCentre’s RISE Program.
With its sole project Alberta Lithium in its final development stages, stock analysts expect its stocks to soar soon. Trading at $1.73 on August 18 at 9:08 am PDT, E3 Metals is another good option for Canadians looking for lithium stocks to invest in.
Why You Should Invest in Lithium Stocks in Canada
The world is continuously looking for ways to incorporate greener technologies in its future projects. Lithium is a key raw material in power generation, electric vehicles, and energy storage. The increased demand and lack of lithium supply have demonstrated that we need new lithium resources to keep up with this ever-increasing lithium demand. You can only do this by investing in lithium development projects. Several investors worldwide are now planning a direct investment in lithium stocks and earning a hefty profit from this lucrative market.
In the last decade, we have seen an enormous boom in the stock prices of companies that excel in lithium resource development. The lithium stocks were off to a good start during the first half of 2010. After that, the stocks kept on rising until 2019, just before the stock market went into a downfall due to the covid-19 pandemic and an increased supply of spodumene.
However, due to the increased efforts of governments across the world, the EV industry has taken up an unprecedented pace. Several world leaders have vowed to ramp up the production of electric vehicles, resulting in a surge in demand for lithium. However, the sluggish supply is not enough to keep up with the rising demand. With the global EV market passing the 10 million vehicles milestone, lithium investors witness massive returns on their investments. Several mining companies have ventured into the world of spodumene mining, and many more are following suit.
The batteries required for energy storage and electric vehicles need to be rechargeable, lightweight, compact, and highly efficient – without compromising energy density. Lithium can store high energy density in a compact area, produces rechargeable batteries, and its mining is environmental-friendly. Therefore, the world is constantly moving towards lithium batteries to satiate its clean energy demands.
The Bottom Line
Stock analysts believe that lithium stocks will become more profitable as we advance into a world powered by clean energy. To meet the battery production targets, we need to invest more in the lithium space. There are several investment opportunities in the battery minerals assets industry. Although the stock prices might come under pressure in the short term, keeping the big picture in mind while investing in the lithium industry is important. Lithium development companies with environmental-friendly technologies are going to be hugely profitable in the future.
Lithium Stocks In Canada
The following article should be a good sign for Canadian lithium stocks, at least in the short term. With big gains in the year to date, here is a guide for investors interested in the lithium space. In ETF trading in 2010, ETFs held all of the above-listed lithium producers – as top holdings. We have provided some examples of the individual stocks that make up the ETF and a breakdown of the market capitalization of each company. Sources: 0, 6, 15
The ETF has 39 holdings, including the three largest lithium producers in the US and several other companies. It also owns shares in a failed lithium mining project that went bankrupt after a 21% slump in lithium prices. Sources: 0
The lithium company has several product lines, but SQM is the most exposed to lithium, leaving it out of many competitors in the US and Canada. It has become a major player in Canada, encouraged by its ability to dominate the lithium market and electrify the country. Today, it owns shares in two of the world’s largest lithium producers and several other companies, such as lithium mining companies. Sources: 2, 8, 14
The company says that its activities are taking place in the so-called Lithium Triangle, where 40% of the world’s lithium is produced at low cost. Sources: 5
While lithium supply has been in line with the demand in recent years, lithium is a comparatively rare element, as it is found only in low concentrations. North America has only one lithium battery, and it is in a brine plant in Nevada. While opportunities for domestic battery production look like a growing market, one of the challenges in the United States is that it is not home to the world’s largest lithium-ion battery manufacturer, Tesla Motors. Sources: 3, 17
Price fluctuations and changes in the lithium market can directly affect companies and stocks that use lithium as a raw material. You can invest in lithium shares by buying shares in specialty chemical companies that produce lithium or companies whose shares use it as a raw material. This could be a good opportunity for a long-term investment in a company with a strong lithium business. Sources: 13, 17
Albemarle Inc. is a leading manufacturer of lithium ingots and metal foils, including lithium-ion batteries, lithium hydroxide and other lithium compounds. The company is headquartered in New York City and operates in the United States and Canada. Livent Corporation has a strong portfolio of specialty lithium products, including lithium hydride (also known as lithium hydroxides) and its use in specialty lithium-ion batteries. Standard Lithium was delivered in September, and in December, it completed the first production run of its first lithium-ion battery production line. Sources: 1, 3, 8, 16
International Lithium has interests in the Mariana Lithium Potash Salt Project in South America, one of the largest and most advanced lithium and lithium hydroxide reserves globally, and many other projects. Tres Quebradas has acted in a manner consistent with the company’s long-term strategy and demonstrated the potential to produce 790 milligrams of lithium per litre at the Mariana Lithium Potash Project, the largest lithium hydroxide reserve in the world. Lithium has reached the top of the global market for lithium carbonate traded in China with a market value of over $3.5 billion. Sources: 0, 12
If you like the best shares, keep reading and look at the other top shares on this list. If Wall Street analysts looking at the lithium stock are believed, there could be a lot more. The project includes the Mariana Lithium Potash Project, the largest lithium hydroxide reserve globally, and several other projects. Sources: 0, 4, 14
The index comprises companies primarily engaged in exploring, developing, and producing lithium hydroxide, lithium-ion and/or lithium chloride (LIC) resources. Sources: 6
The lithium market is dominated by Quimica y Minera de Chile, which produces more than half of the world’s lithium. The figure results from a merger between two of Chile’s largest lithium producers, QuIMica and Quiros. Renamed Junior is run by a group of companies that have failed to restructure and transform into a junior mining company focused on lithium hydroxide and lithium chloride (LIC). Sources: 2, 9
Although it is not just lithium shares, the cheapest lithium shares are the company’s shares, which trade at less than 1% of its estimated earnings. Shares rose 320% in November after the company announced a $1.00 dividend. Sources: 0, 7
For investors interested in the lithium space, here is a list of the best lithium stocks in Canada and the United States: If you want to get more involved in good lithium stocks, consider the Canadian Lithium ETF (TSX: LIT) or Canadian lithium ETF. Although it is the only lithium ETF, it is not the only diversified direct play on the market. Get access to a wide range of exchanges – traded funds that track the price of lithium and other precious metals such as gold, silver, copper, zinc and nickel, including ETFs, mutual funds and even a lithium index fund. Sources: 4, 15
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