Investors Missed the First Lithium Boom… Will You Make That Mistake Today?

Four years ago, my mother-in-law gave me a little piece of advice that I practically dismissed at the time. 

It was a tip to check out the lithium market. 

Mind you, this was back in 2017, when every news headline and two-minute clip on CNBC was gushing over Tesla, Elon Musk, and the lithium boom that was raging at the time. 

So we had already set our sights on the next leg of the EV boom by the time I was given that sage piece of dinner-table advice. 

Now, the veteran members of our investment community here at Energy and Capital probably remember those lithium years well — it was one helluva bull market. In fact, we had been successfully riding that wave for the better part of two years at that point. 

And make no mistake, a few of those lithium trades turned out to be some of our best winners to date. 

When the market started selling off sharply in 2018, the investment herd did what it does best — buy at the top and run for the exits.

That’s not a mistake it’s going to make again.

But today, the stakes are much, much higher. 

The Second Stage of the Lithium Revolution 

Look, you can’t say I didn’t warn you. 

How long have we talked about the massive supply/demand gap ahead for lithium? Years? Has it been a decade at this point? Probably. 

Long before the word “Gigafactory” became a household name, my colleagues and I were prognosticating a world full of electric vehicles. 

Most investors back then weren’t ready to drink the Kool-Aid yet. 

Well, they certainly are now.

Yet when every pundit I know was screaming about lumber prices this year, few bothered checking out the lithium market. 

Remember, the lithium market is one of the biggest winners in the EV revolution. 

That has certainly been the case over the last 15 months. Take a look for yourself:

That’s a chart of the Global X Lithium & Battery Tech ETF, which counts the world’s largest lithium producers — including Albemarle Corp. — among its top holdings.

But is this kind of movement really surprising to see?

Over the last few weeks, we’ve talked about the incredibly ambitious goals that major tech and auto companies are setting for themselves. 

The $35 billion GM is investing in its future fleet will push the company closer to its goal to be carbon-neutral by 2040. 

This kind of investment we’re seeing from every major player has led to a desperate scramble for future lithium supply.

So how desperate are they? 

For GM, it meant announcing a strategic investment and commercial collaboration with Controlled Thermal Resources. 

Haven’t heard of it? Don’t worry — I have a feeling not many investors have heard that name before. 

But this isn’t your traditional lithium company. 

In order to provide GM with a big portion of its lithium needs, Controlled Thermal Resources claims it can ramp up production using a closed-loop, direct extraction process that comes with a friendlier environmental footprint. 

Of course, the catch here is that average investors like us are essentially shut out of this opportunity. The only access you have is through a private placement. 

That’s also not to mention that the first shipments of lithium wouldn’t begin for several years, and that’s assuming there are no hiccups in the process either. 

Sounds like a bit of a tall order, doesn’t it?

Only time will tell.

Until next time,

Keith Kohl

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A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.

For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.

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