Ioneer Signs Third Offtake Deal

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US-based lithium and boron miner Ioneer [ASX:INR] lifted 2% this morning on the news of another — third — binding lithium offtake deal.

Ioneer has identified its latest offtake comrade in battery maker, Prime Planet Energy & Solutions.

The lithium miner has risen 10% in the past week and 39% in the last few weeks.

Despite these results, the miner trends down year-to-date by 29% in share value.

On the other hand, Core Lithium has been rocketing 24% in the past month, heading higher since its glitch in June. Core is up 13% in the last week alone.

Arizona Lithium has been tearing downhill since spiking in April, falling 8.5% in the last week.

As lithium undergoes corrections this year, shares are hitting new levels of volatility. What does Ioneer have to say about things?

ASX:INR ioneer stock chart

Source: Tradingview

Ioneer partners with Prime Planet

This morning, lithium developer Ioneer announced the third of its new offtake agreements for direct supply of its Rhyolite Ridge lithium, sourced in Nevada, US.

Ioneer’s lithium will be incorporated into lithium-ion batteries by Prime Planet, a joint-venture battery company shared with Toyota Motor and Panasonic, in support of the US EV supply chain and production ramp-up that aims to boost renewable energy in the US.

The agreement is to last a five-year term. It includes the amount of 4,000 tonnes of Ioneer’s Rhyolite Ridge Lithium-Boron lithium annually, representing around 19% of the project’s annual output in its first five years of production.

Ioneer believes Rhyolite Ridge will produce around 20,600 tonnes of lithium carbonate/hydroxide and 174,400 tonnes of boric acid a year, over 26 years of the mine’s overall lifespan.

The lithium developer aims to begin production by 2025, spurred on by the US Government’s ongoing support of battery metal production.

INR Executive Chairman James Calaway commented on the new agreement:

Ioneer is grateful to announce another key milestone for our company with a lithium carbonate offtake agreement with PPES. PPES is a world-class organisation, and we look forward to being their trusted partner. This and the previously announced Ford and EcoPro agreements solidify Ioneer’s focus on the U.S. Electric Vehicle supply chain infrastructure. We look forward to providing lithium materials to PPES and all our offtake partners for their growth in the EV global market.’

Prime’s president, Hiroaki Koda, also said of the offtake:

I am delighted to have a great partnership with Ioneer in the battery supply chain, that can promote vehicle electrification toward realizing a carbon-neutral society. Having an agreement with Ioneer provides PPES a first step in securing a U.S. supply of lithium, one of the most important parts for corresponding with the fast growing electrified vehicle industry. We have confidence in Ioneer’s technology of refining sedimentary sourced lithium and their competitiveness, and are expecting it to strengthen the PPES supply chain.’

INR’s outlook: EVs remain a strong industry

As a lithium developer, INR knows its main role so far has been to secure supply partners before its project’s production begins, first with its EcoPro Innovation arrangement, and more recently with Ford and now Prime Planet.

INR has been smart about positioning itself where Biden’s government is actively boosting EV metal production by way of loans and initiatives.

Biden’s impassioned public campaigning for the US economy’s EV prospects strengthening the odds for US-based lithium developers.

Additionally, Ioneer explains its dual production of lithium and boric acid allows it to produce lithium ‘at the very bottom of the global cost curve’.

Does this lithium developer have it right? Time will tell.

We all know there’s plenty of competition out there.

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According to two of our top analysts…not necessarily.

They have, in fact, recently revealed three Aussie lithium stocks that have been severely overlooked.

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About Kiryll Prakapenka

Kiryll Prakapenka is a research analyst focusing on investigating the biggest trends in investments. Kiryll brings sound analytical skills to his work, courtesy of his Philosophy degree from the University of Melbourne. A student of legendary investors and their strategies, Kiryll likes to synthesise macroeconomic narratives with a keen understanding…

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