The Pilbara Minerals Ltd (ASX: PLS) CEO believes a significant deficit in lithium supply in the next 10 years could be a "massive opportunity" for the company.
Pilbara shares fell 0.83% on Tuesday, closing at $4.77 each. For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) slid 0.74%. Other lithium players had it tougher. Core Lithium Ltd (ASX: CXO) shares dropped 1.85%, while Sayona Mining Ltd (ASX: SYA) shares tumbled 6.38%.
Let's check what the Pilbara Minerals boss had to say about the company's future prospects.
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Is this a big opportunity?
Pilbara Minerals CEO Dale Henderson is optimistic about the outlook for lithium supply over the next decade.
Commenting in the KPMG 2023 Global Mining and Metals outlook, Henderson said:
With the market predicting a significant deficit in lithium supply relative to demand over the next 10 years, this presents a challenge for the world, but a massive opportunity for us.
He added the company has a "strong level of confidence" it can deliver into that lithium supply deficit, adding the game plan is "pretty simple".
Put the foot down and maximise the value of the resources as rapidly as we can.
Pilbara produced 148,131 dry metric tonnes (dmt) of spodumene concentrate in the March quarter at an average sales price of US$4,840 per dmt.
The company reported a cash balance of $2.683 billion at the end of the quarter, up 21% on the previous quarter.
Pilbara shares are a buy, according to the team at Macquarie. The broker has an outperform rating on the company's shares and a $7.70 price target.
Currently, lithium carbonate (99.5% battery grade) is fetching US$41,520.92 on the Shanghai Metals market.
What about China and the USA?
The KPMG report also considered the impact of any geopolitical tensions on the metals and mining industry, including relations between the US and China.
Commenting on this issue, Pilbara's Henderson said, "We are thinking about strategies to manage the geopolitical dimension." He added:
We are balancing the fact the whole lithium industry pretty much looks to China for the processing of raw materials, so we can't sever that tie, nor do we want to.
Share price snapshot
Pilbara Minerals shares have soared 70% in the last 12 months, rising 27% year to date.
Pilbara has a market capitalisation of around $14.3 billion based on the latest share price.
