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Livent Corp – A Pure-Play Lithium Player with an Electrifying Future

29 Apr Livent Corp – A Pure-Play Lithium Player with an Electrifying Future

Livent Corporation (NYSE: LTHM) is a premier pure-play lithium technology company that delivers cutting-edge polymers and energy storage and battery systems for numerous industries such as electric vehicles, aerospace, pharmaceuticals and agrochemicals. The Company believes in powering a cleaner, healthier and more sustainable world by leveraging lithium technology.

The Company is using a combination of innovative product solutions, industry-leading material science expertise and a fully integrated supply chain to work closely with its customers to harness the power of lithium and convert it into commercial products. Livent is one of the key suppliers for Tesla (NASDAQ: TSLA) and has also entered into a supply agreement with BMW (OTCPK: BMWYY), which is a testimony to its potential.

Livent’s endeavours date back to the 1940, when Lithium Corporation of America was working closely with the U.S government on exploring the applications of lithium. In 1985, the Company’s lithium business was acquired by FMC corporation. Furthermore, Livent’s innovation in lithium powered the first lithium-ion batteries used in hand-held camcorders by Sony in 1991.

Livent manufacturing facilities are spread over North America, South America, Europe and Asia Pacific. Besides the United states the Company’s offices are present in England, Argentina, Mumbai, China, Japan and Singapore.

Livent Corporation (NYSE: LTHM)

Market Cap: $2.76B; Current Share Price: 18.83 USDChart
Data by YCharts

The International Energy Agency predicts that the Electronic Vehicles which stand at 3 million today will grow to 125 million by 2030. The Global Electric Vehicle market is all set to compete with the internal combustion engine (ICE) vehicles in the next five years, accounting for one out of every five cars sold by 2030, according to Seth Goldstein, an analyst and chair of Morningstar’s electric vehicle committee.

The demand for electric vehicles will also bolster the demand for ancillary industries such as engine components, electronics for propulsion systems, battery optimization and torque transfer devices. In fact, the demand for lithium, which is a crucial component of energy storage in transportation batteries, is likely to quadruple over the next decade according to Seth Goldstein.

Lithium batteries offer a plethora of advantages when compared to lead-acid or other batteries such as better charge discharge efficiency, improved battery life, ease of maintenance and durability. Most importantly the batteries are made of light weight material and offer superior temperature control in addition to safety, longer shelf life and greater usable capacity. The batteries are suitable for a wide array of applications as they charge and discharge more rapidly when compared to conventional batteries and have lower downtime as well. The size and weight of these batteries is almost half of lead-acid batteries, which results in easy installation and more flexibility.

These batteries are perfectly suited to the needs of Electric Vehicles and are emerging as the most popular alternative to Lead-acid battery, Nickel-metal Hybrid batteries among others as they offer benefits such as improved charge efficiency without memory effect, compactness and are more environment friendly.

According to a report by Statista, the Global Lithium Battery market size is poised to reach 100.4 billion U.S. dollars by 2025 growing from 30.2 billion U.S. dollars in 2017.

A Diversified Product Portfolio
The Company is also a pioneer in producing high-energy density cathodes, which is an essential component for major battery producers and automakers. Livent’s patented Stabilized Lithium Metal Powder (SLMP®) material can help advance the next-generation high-energy density batteries. In addition, the Company has extensive experience in lithium extraction and purification technology.

Livent’s offerings can be categorised by the type of markets it serves, the application of its products and the end-consumer. The Company’s product offerings include performance lithium compounds such as lithium hydroxide that help in creating long-lasting energy dense batteries, Ultra-pure lithium hydroxide monohydrate intended for use in the production of electrolyte salts and additives. In addition the Company also produces Lectro® Max 400, Lithium IngotLectro® Max 410 and Lithium Aluminum Alloy Ingot for the Energy Storage & Battery SystemsAerospace market.

Livent also manufactures polymers for use in tires or lightweight automotive interiors lithium hydroxide-based lubricant products for use in modern planes, trains, and automobiles. The Company also produces high-purity lithium metal for use in the aerospace industry. In addition, Livent also serves the consumer electronics industry.

Key Takeaways

  • The government’s position on clean energy was made clear by its recommitting to the Paris Climate accord and its call for moving to clean energy by 2035 and achieving net-zero carbon emissions by 2050. The new administration will invest close to $1.7 trillion over the next 10 years in its bid for a “Clean Energy revolution” that aims to establish US as the clean energy superpower and transform the energy sector by providing economic impetus. The government plans to replace its existing federal fleet with electric vehicles along with measures such as tax credit for large-scale adoption of the technology. This will provide impetus to the ancillary industries especially that deal with energy storage.
  • The COVID-19 pandemic has had a negative impact on the Lithium market, as production facilities shut down across the globe. However, the opening up of the economy and restarting of manufacturing facilities have seen a growth in the sales of EV vehicles, which is expected to continue with the increasing government support and rising demand for EV’s in both the developed and emerging economies.
  • The Company has brine assets in Argentina that is one of the lowest-cost carbonate production facilities, which not only gives it access to low-cost lithium production but also provides a competitive advantage as lithium prices come under pressure due to increasing supply and declining prices.
  • Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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