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$URRE The primary use for lithium is a key ingredient in rechargeable batteries for electronic devices and electric vehicles. Lithium ion batteries, as they are known, have been adopted as the standard method of powering electronic devices such as smart phones and small, portable computers for some time, but it is the transportation market that is expected to drive growth for the next decade. Growth in consumption of lithium is expected to average over 6% annually between now and 2025, according to CRU International Limited, with the transportation sector accounting for much of this growth. This major component is expected to rise from 20% to 39% of total demand over the next seven years.

At the same time, lithium prices have risen in response to increased demand. Lithium Carbonate (“LCE”) is one form of lithium used for battery manufacturing, and prices have risen from $5,792 per metric ton in 2015 to $7,300 per metric ton in just over a year. Lithium Hydroxide, a second form of the material, prices have risen from $6,974 per metric ton to over $23,000 per metric ton during the same period.

URI’s new business targets production of lithium carbonate from lithium salts brines. This is typically the lowest cost type of processing. While the technologies are well known in some respects, it takes time for deposits to be discovered and developed, which should result in a supply deficit over the next few years. We believe that expected higher prices should encourage investment in the sector and bring new sources of production online over time. CRU International Limited expects long term lithium prices to stabilize at approximately $6,400 per metric ton and $9,400 per metric ton for lithium carbonate and lithium hydroxide, respectively. These are considerably higher than the historic prices for these products.

URI is targeting exploration and development of lithium brines because they are characteristically in the lowest operating cost quartile of production, and would be more likely to be profitable in the markets described above.

http://www.uraniumresources.com/investors/news-releases/2017/06/20/uranium-resources-continues-lithium-business-expansion