The supply contract negotiated by Tesla with the Australian lithium producer Core Lithium will not be concluded. According to Core Lithium, the deadline for the deal was 26 October 2022, but the contract was not finalised.
However, the company does not give details – but they seem to be further open for potential cooperation in the future. “I want to thank Tesla for taking the time to negotiate with Core and I look forward to having an open and ongoing dialogue,” says Core CEO Gareth Manderson.
That Manderson is not mourning the failed deal may also be because he does not have a demand problem. The Finniss lithium mine was recently opened and 15,000 tonnes of ore have already been sold. Core does not name individual customers, but they are “several participants involved in the lithium-ion battery supply chain”. In early 2023, it plans not only to continue selling ore, but also to offer customers processed spodumene concentrate. According to the announcement, demand for the material has been high, “which is reflected in the price achieved”. It remains purely speculative, however, whether Core was now able to achieve higher revenues on the open market than would have been the case with a Tesla supply contract.
Since Core also has existing agreements with Chinese companies Ganfeng and Yahua, it has already secured the purchase of 80 per cent of the expected production for the first four years from the Finniss mine. “The recent DSO (direct shipping ore, editor’s note) sale, the expected start of lithium concentrate sales in the first half of 2023 and a rising lithium price show that Core Lithium is well positioned to benefit from high demand and the current shortage of available battery-grade lithium spodumene concentrate,” says Manderson.
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