Jon Hykawy: Global Vehicle Electrification Trend is Unstoppable at this Point

Jon Hykawy: Global Vehicle Electrification Trend is Unstoppable at this Pointyoutu.be

At Fastmarkets’ Lithium Supply and Raw Materials conference, the Investing News Network (INN) sat down with Jon Hykawy of Stormcrow Capital, who shared his insight on the lithium industry.

“For a long period of time, we're going to see continued sales, we're going to see the banning of internal combustion vehicles, we're going to continue to see roses and sunshine across the entire industry,” he said. “And perhaps that's not quite as realistic, and maybe has never been as realistic as it's been portrayed.”

Lithium prices went through the roof last year as COVID-19 restrictions paired with strong demand from the electric vehicle sector supported higher levels.

“We saw a very dramatic price increase over the last year that was driven, frankly, by just about a perfect storm,” Hykawy said. “Yet we're at a point where prices have gotten uneconomic in some markets.”

With macroeconomic variables hitting the stock market and a bearish report from investment bank Goldman Sachs (NYSE:GS), lithium stocks have been experiencing downward pressure.

Commenting on the disconnect seen between the stock market and lithium prices, Hykawy said the electrification of fleets is unstoppable at this point.

“How fast we're going to see that transition, I guess, is the question,” he said. “But at this point, optimism is warranted and the stock market eventually will get over whatever it's getting over and it will come back.”

For investors interested in lithium, Hykawy shared his insight on how to select a lithium project today.

“Any project that can produce at a profit with a reasonable long-term cost of lithium — and that long-term cost of lithium is probably looking like US$15,000 a tonne, maybe not US$70,000 — that's the place that you're looking for, and there are a large number of projects that can do that.”

Listen to the interview above for more of Hykawy's thoughts on lithium, as well as the rare earths market and what he expects to see in the critical minerals sector from now until 2025. You can also click here for INN's full playlist from the Fastmarkets event 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.