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What are your thoughts on NIC (Nickel Industries) and SYR (Syrah Resources)?

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What are your thoughts on NIC (Nickel Industries) and SYR (Syrah Resources)?

Thanks a lot for taking this question. BYD and CATL ae both developing Sodium-Ion Battery for the EV market in China. Sodium is not being looked at as a replacement for lithium, more a mixing partner for use in some types of batteries and small EVs and Plug-ins. Nevertheless, this will reduce the demand for Lithium-ion Battery. I think that Sodium-Ion battery will be cheaper to produce as it will not use some of more expensive mineral components like Nickel, Rare Earth, and ..…..etc. Could you please discuss the impact of this development will be on Nickel, and Graphite Miners such as Nickel Industries (NIC) and Syrah Resources (SYR). Thanks again for taking this question

Answer

Hi Peter,

A very topical question because on Friday we switched our IGO Ltd (IGO) position into Pilbara Minerals (PLS) for 2 main reasons:

  • Lithium miner Pilbara (PLS) has net cash of $2.7bn with dividends about to flow.
  • IGO Ltd (IGO) has a large nickel exposure  as well as lithium which does concern us with the evolution of new battery technology.

This is a fascinating subject with plenty of more twists in the tale in our opinion, one thing we are confident of is that EV batteries will look very different in 5-10 years time than they do today. Manufacturers will move towards cheaper greater efficiency, MM believes they will still incorporate lithium but far less expensive metals such as nickel & rare earths i.e. sound like we agree with you and have invested accordingly.

Regarding the Sodium-Ion battery, it’s our understanding that there is still a long way to go here to get better milage, and this may or may not happen, however what it does do is highlight that we need to keep a close finger on the pulse of this emerging industry as things will change as significant amounts of capital are invested into new areas.

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Nickel Industries Ltd (NIC)
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