Nemaska Lithium and FMC entered into a long-term lithium carbonate supply agreement, beginning mid-2018.
One of the top lithium mining companies FMC (NYSE:FMC), rocked the lithium sector when it announced it had entered into a long-term supply agreement with Nemaska Lithium (TSX:NMX) on Monday (October 31).
According to FMC’s press release, Nemaska is to provide FMC with 8,000 metric tonnes of lithium carbonate per year, beginning sometime in 2018.
Tom Schneberger, vice president and global business director of FMC, said that FMC is looking forward to the partnership with Nemaska.
“This agreement will further diversify our supply sources while fueling our growing production of high quality, specialty lithium products,” Schneberger said in the press release.
In a press release, Guy Bourassa, president and CEO of Nemaska said that Nemaksa’s process of producing lithium carbonate “meets FMC’s quality specifications.”
“Our production line is flexible and cost effective, allowing us to be opportunistic and address a broader lithium salts market by producing both battery grade lithium hydroxide and lithium carbonate,” Bourassa said. “I believe in the long term the lithium battery market will continue to move toward lithium hydroxide chemistries and we are very well positioned in this space.”
With that in mind, a number of analysts and experts in the industry took to Twitter to share their thoughts on the agreement.
Joe Lowry, president of Global Lithium LLC, said the deal shows how the lithium sector is evolving. However, Lowry doesn’t think Nemaska will have 8,000 metric tonnes of product before 2020. He did note, however, that he is “rooting for them.”
— Joe Lowry (@globallithium) October 31, 2016
Simon Moores, managing director of Benchmark Mineral Intelligence, said the agreement is a good step forward for Nemaska, noting how the “times have changed” in the industry.
Nemaska #Lithium and FMC. Great move by the Nemaska team, shows how desperate the majors are to lock up long term supply.
— Simon Moores (@sdmoores) October 31, 2016
Nemaska said in its press release that it will start receiving lithium samples from its Phase 1 Plant sometime in 2017.
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Securities Disclosure: I, Jocelyn Aspa, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Nemaska Lithium is a client of the Investing News Network. This article is not paid for content.