Since its September 2018 quarter, Alliance Mineral Assets Ltd’s [ASX:A40] lithium production has fallen around 20%, significantly impacting its trading value.
At the time of writing, Alliance Mineral’s share price has dropped 13.5%, to trade at 16 cents a share.
While events like production loss may seem unforeseeable, that’s all just part and parcel of stock picking.
That’s why resource expert and Money Morning contributor, Jason Stevenson, gives you his top 10 resource stocks trading on the ASX in 2019. You can read more about it here for free.
Alliance Mineral’s share price see’s low feed grade lag
During October and November last year, Alliance was plagued by low feed grade which caused the drop in production and share price.
Thankfully, production has picked up during the December quarter, but there still seems to be some lag in Alliance Mineral’s share price. As it stands, production costs for the quarter was around $1,152 per tonne of lithium concentrate.
Alliance Mineral’s 2019 quarter outlook
On 29 January Alliance Mineral recorded a production guidance of 65,000–80,000 tonnes of lithium concentrate for the next six months, or until July this year.
Elsewhere, offtake negotiations of Alliance Mineral’s remaining 50% of long-term production is projected to be mostly completed by March 2019 quarter.
Alliance Mineral is also looking for new offtake partners to back its remaining stage 1 lithium and stage 2 lithium 2 concentrate production.
Time will tell if this increased production will create some damage control to Alliance Mineral’s shares.
For Money Morning
PS: Want to know what’s driving this ‘Green Energy’ stock frenzy? In a brand new Money Morning report, Editor Jason Stevenson reveals three Aussie lithium stocks that could be names to watch. Download this report to find out here for free.