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For the most part, the cost of production is what matters. If Chilean lithium costs $x and US lithium costs $3x then it doesn't matter how is in the ground in t
by dmm 14y ago
For the most part, the cost of production is what matters. If Chilean lithium costs $x and US lithium costs $3x then it doesn't matter how is in the ground in the US, the lithium will come from Chile.
- rosser 14y agoUntil Chinese demand for Chilean a/o Bolivian lithium drives its price over $3x, at which point, having a local supply this big is a huge deal.
- psgibbs 14y agoReally, only in the sense that this source pushes out the aggregate supply curve, delaying the point in time when prices get higher. Practically, once prices become 3x of current, that's what everyone will pay on average, it just means (in this thought experiment) that some miner sourcing from America is marginally profitable, while some miner from South America is very profitable.
- rosser 14y agoDid the existence of shale oil or tar sands delay crude breaking $80/barrel? More expensively exploited resources typically aren't exploited until their market price makes such exploitation profitable. We've known about the vast amounts of oil under the Bakken Formation since the 1950s, for example. If this stuff is more expensive than Bolivian lithium, we won't do more than tinker with it until it's not, and consequently I wouldn't expect it to have much impact on the price curve — we'll all still be buying the same stuff until then.