Close menu

August 9th, 2021 | 12:14 CEST

BYD, GSP Resource, Standard Lithium - Lithium hype, but do not forget copper

  • Copper
Photo credits:

In recent weeks, real hype has broken out around lithium. It is said that lithium producers cannot adapt to demand so quickly. Due to the radical change of course in the automotive industry away from the combustion engine to the e-car, the demand for lithium will increase considerably. The price of lithium has already doubled from USD 5,000 to USD 10,000. It is expected that demand will increase by 300%. It should not be forgotten that copper is also essential for the switch to e-mobility. But it is not just in that sector that the demand for copper is increasing; worldwide, more and more people are gaining access to electricity. Today, we look at BYD, a manufacturer of e-vehicles, and two potential suppliers of copper and lithium.

time to read: 4 minutes | Author: Armin Schulz
ISIN: BYD CO. LTD H YC 1 | CNE100000296 , GSP RESOURCE CORP. | CA36249G1090 , STANDARD LITHIUM LTD | CA8536061010

Table of contents:

    BYD - Tesla's biggest competitor

    Historically, BYD is a battery manufacturer that launched in 1995. Since 2003, the group has also been active in the automotive business. Due to the technological lead of the leading car manufacturers, BYD's founder decided to specialize in the development of e-vehicles as early as 2008. An idea that is now paying off more and more. Because the blade batteries are so good, there are already rumors that even the market leader Tesla wants to install them in its vehicles.

    Such a battery for an electric car contains between 8 and 16 kg of lithium, and the lithium-ion battery consists of 18% copper. In total, over 70 kg of copper is needed for an e-car. Current combustion engines contain about 25 kg of copper. Here, too, the trend is upward because more and more electric motors are being installed to provide greater comfort. The copper requirement is therefore also increasing almost 3-fold. The significant increase in raw material prices for both components gives an idea of what the further increase in demand will mean.

    The BYD share marked a new all-time high last week. Of course, this is also due to the rumors about possible deals with Tesla. But the numbers for July were excellent. There were 139% more electric vehicles sold year-on-year. With 24,560 cars sold, more vehicles were delivered than competitors NIO, Xpeng and XPEV combined. After the rally, we would wait for consolidation to enter. If the rumors surrounding Tesla are confirmed, the stock will continue to rise.

    GSP Resource - A takeover candidate

    Major commodity producers have sought large copper deposits for years, unfortunately without success. The demand for copper is constantly increasing, explaining the high copper price, even if a slight consolidation has recently set in. GSP Resource (GSP) owns two projects in British Columbia where copper was mined in the past. At that time, still with the lorry and pickaxe.

    The smaller Olivine Mountain project was acquired on May 19 and is located just 25 km southeast of the Copper Mountain copper mine. Two discoveries have been reported to date, the Asp deposit at 3.51% copper and some silver over 3.4m and the Hop deposit at 7.49% copper, 23 grams of gold per tonne and 89.5 grams per tonne of silver. The flagship project, however, is the Alwin Mine, where the drill program is currently underway.

    The results of the program are eagerly awaited by the end of August at the latest. The Alwin Mine is located in the immediate vicinity of Teck Resources' Highland Valley Copper Mine. If the results are correct, the likelihood of a takeover by the major competitor increases. After acquiring the Olivine Mountain project, the stock has given back all the gains from the jump in the share price to CAD 0.50. It has now formed a triple bottom at around CAD 0.22. With the results, another price jump could beckon here.

    Standard Lithium - Pilot plant running

    The Canadian lithium producer Standard Lithium should be known to many Tesla fans since Elon Musk certified a lot of potential to the Company in 2020. Although the Company is based in Canada, it has mining projects in the US. The first project is called Bristol Lake and is located in the Mojave Desert of California. It has agreements with two brine processing companies operating on-site for more than 20 years to get production going.

    But the main project is the Smackover project in Arkansas, in partnership with Lanxess. In this area, Lanxess mines bromine from brines. The process used does not evaporate water to extract lithium but relies on the brine flow. Not only does this protect the environment, but it is also much faster than the conventional process. In June, Lanxess converted a loan it had granted into shares and warrants. Lanxess has thus increased its stake in Standard Lithium. The pilot plant is producing lithium after a few teething problems.

    It is not only since the takeover of Millennial Lithium that rumors have been swirling around Standard Lithium that the Company could be taken over. There was talk of Tesla, Lanxess and others. Nothing has been confirmed so far. The share price has more than doubled since the beginning of the year, also due to the high lithium price. Should a takeover take place, the price should be even higher. However, we would wait for a setback before venturing an entry.

    Due to the industrial revolution towards e-mobility, the required raw materials will become scarce in the future. While lithium is available worldwide in sufficient quantities but has yet to be brought into production, the situation is quite different for copper. Here, resources are scarce, and bottlenecks cannot be eliminated as quickly as with lithium. In our view, investing in copper, using GSP Resource as an example, is worthwhile and preferable to Standard Lithium. BYD may have to struggle with high raw material costs in the long run.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but rather financial analysis, but rather journalistic or advertising texts. Readers or users who make investment decisions or carry out transactions on the basis decisions or transactions on the basis of the information provided here act completely at their own risk. There is no contractual relationship between between Apaton Finance GmbH and its readers or the users of its offers. users of its offers, as our information only refers to the company and not to the company, but not to the investment decision of the reader or user. or user.

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered here. Please also note our Terms of use.

    Der Autor

    Armin Schulz

    Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

    About the author

    Related comments:

    Commented by Juliane Zielonka on August 18th, 2023 | 08:00 CEST

    Globex Mining, Deutsche Lufthansa, Rheinmetall: Share prices soar on the back of impressive deals

    • Mining
    • Gold
    • Copper
    • Aviation
    • armaments

    Globex Mining achieves several deal highlights: The exploration company receives CAD 2 million in cash from Agnico Eagle for a land purchase, with further opportunity for a growing asset. Over 23 months, an additional CAD 6 million is expected to flow to Globex Mining. Then follows an option agreement with Tomagold Corporation on a Canadian gold property at Gwillin Lake near Quebec. Total payments of six figures are due over the next four years. In addition, shares in Tomagold will be transferred to Globex Mining. While German Foreign Minister Baerbock was more conspicuous for flight mishaps, the Lufthansa Group achieved an adjusted EBIT of around EUR 1.1 billion in Q2/23. The subsidiaries SWISS, Austrian Airlines, Brussels Airlines, Eurowings and Lufthansa Technik also posted record results. Furthermore, Rheinmetall is also taking to the skies - now supplying drones to Ukraine.


    Commented by Fabian Lorenz on July 14th, 2023 | 07:50 CEST

    Bulls at the controls: Nel, Barrick Gold, Viva Gold! What about BASF?

    • Mining
    • Gold
    • chemicals
    • Copper

    Low inflation in the US has given new impetus to the bulls. Not only are growth stocks benefiting from the hope that the interest rate cycle is coming to an end, but also gold. Thus, the gold price reacted on Wednesday by jumping to over USD 1,960 per troy ounce. Top-tier gold stocks such as Barrick also responded positively. Exploration companies have significant catch-up potential, including Viva Gold. The Company is favorably valued and has again reported positive drill results. The fact that the interest rate cycle is nearing its end is also evident in the chemical industry. Most recently, BASF issued a warning, and there are sell recommendations. On the other hand, there are buy recommendations for the Nel share.


    Commented by André Will-Laudien on June 6th, 2023 | 07:45 CEST

    Climate Crisis: Copper is the new oil! BYD, Orestone Mining, Ford, Nio - 100% acceleration in Greentech

    • Mining
    • Copper
    • Electromobility
    • GreenTech

    At the beginning of May, analysts at Bank of America declared a new "super cycle" for basic and raw materials. What they mean by this is that a whole series of important materials will be in great short supply for years. The prime example is the red metal copper. The price of the industrial metal has almost doubled in the past 12 months. It is currently quoted at around USD 8,350 per tonne, not far from the historic high of USD 10,750. During the pandemic, the metal briefly fell to USD 4,500. Currently, however, forecasts are once again pointing upwards. Bank of America expects the price to more than double again to around USD 18,000 in the next three years. We take a look at some hot stocks.