Pilbara Minerals Ltd (ASX: PLS) CEO Dale Henderson does not believe in cutting ties with China given its role in processing raw materials.
Henderson reflected on the impact of the US-China rivalry on supply chains for the KPMG 2023 global mining and metals outlook this week.
The CEO of this ASX 200 lithium share said "we don't have any cause for concern", and noted "it's always been a healthy relationship".
However, Pilbara certainly does pay attention to the "geopolitical utterings between the US and China", with Henderson commenting:
I don't foresee China making any detrimental move to increase the distance between Australia and China, in respective of raw materials, particularly within the lithium supply chain, because it would hurt them massively.
Their industries are very dependent on Australia, and we have a co-dependent relationship.
Image source: Getty Images
Geopolitical factors
KPMG surveyed 400 C-suite executive and board members on decarbonization plans, including geographical factors for the report, released this week.
Of those surveyed, 65% are planning to expand to more countries within the next five years.
Henderson highlighted how the lithium industry relies on China and would not want to cut this connection, stating:
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.
We continue to diversify into other markets, although we can't pivot elsewhere too quickly.
Pilbara owns the Pilgangoora lithium project in Western Australia, 120km away from Port Hedland. In quarter three of FY23, Pilbara produced 148,131 dry metric tonnes (dmt) of spodumene concentrate.
The averaged realised price for spodumene concentrate was US$4,840 per dmt.
Pilbara Minerals share price snapshot
The Pilbara Minerals share price has soared 67% in the past year.
This ASX 200 lithium share has a market cap of about $13.88 billion based on the latest share price.
