The Investing News Network had the chance to talk with RK Equity’s Howard Klein at this year’s Prospectors & Developers Association of Canada (PDAC) convention about what’s been happening in the lithium space.
Speaking about the amount of lithium that will be needed to meet increasing demand from the electric vehicle industry and energy storage sector, Klein said there’s definitely been an awakening among market participants.
“The momentum of deal activity is going to accelerate,” he said on the sidelines of the Toronto-based event, held from March 5 to 8. “And (OEMs and battery makers) are trying not to appear as if they’re panicked, but I feel that there’s musical chairs, it’s finally sinking in. But they’re still balking because of all the misinformation out there.”
He added that negotiating leverage continues to be with the miners. “The prices of lithium are going to be stronger for longer. And these guys are going to wake up properly, and they’re confronting a bit of a nightmare,” said Klein.
Lithium prices have recently pulled back after a two year rally, with Chinese lithium prices falling almost 30 percent from their high last November. But Klein said he doesn’t see this downturn as a concern.
“The pullback in lithium prices does not worry me at all,” he said. “In fact, you know, investors should be licking their chops to the extent that this very short-term fall in lithium prices is creating opportunities to buy the dip in the lithium equity sector.”
Klein also shared his thoughts on how to think about geopolitics when making decisions. “When you factor geopolitics and localized supply chains into your thinking, focus on the big US market and who can serve that big US market,” he said.
Aside from that, Klein discussed key catalysts to consider when investing in lithium juniors and shared the details of the first RK Equity online lithium conference, scheduled for March 21. Listen to the interview above to hear more of his thoughts. You can also click here for the Investing News Network’s full PDAC playlist on YouTube.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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