here’s a new metal in town, and it’s bigger than lithium—and hotter than any other commodity on the market right now.
Supply is fantastically tight and set to get phenomenally tighter.
Tesla’s (NASDAQ: TSLA) massive $50-billion market cap says all we need to know about EV growth. The company is redefining the auto industry. Tesla launched its $5-billion battery gigafactory in Nevada in January, and by the end of this year already it will have double the entire global battery production capacity. By 2018, Tesla expects to be putting out more batteries that the rest of the world combined.
This alone means a definitive run on cobalt, and the small-cap explorers like Scientific Metals who offer up new North American supply first could be the biggest winners.
Last year, electric vehicle production grew 41 percent. Now, sales are up more than 60 percent year on year. The EV market has grown over 15 times, with an amazing compound annual growth rate of over 72 percent from 2011-2016. This year, analysts expect it to gain another 25-26 percent.
The supply chain can’t hack it because we don’t have nearly enough ethical sources. With more than half of the world’s supply coming from the DRC, and the Western buyers under pressure to find more ethical sources, there a “complete vacuum out there” in terms of supply, traders told the Financial Times on 23 February.
Scientific Metals plans to be among the first to fill that vacuum.
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