The Pilbara Minerals Ltd (ASX: PLS) share price is up more than 5% after announcing its latest lithium cargo sale.
Pilbara Minerals is one of the biggest lithium miners on the ASX and it’s planning to grow its lithium production as well as get involved with the value chain (of making battery-ready lithium).
Latest sale
The lithium price continues to climb, which is putting a rocket under the ASX lithium share.
On 20 September it announced it had sold 5,000 dry metric tonnes at a price of US$6,988 per dmt. This price, when adjusted for lithia content and adjusted to include freight costs, equated to a price of around US$7,708 per dmt.
Last week on 18 October, the resources business revealed that it had accepted a pre-auction bid of US$7,100 per dmt for another 5,000 dmt. After adjusting for lithia content and freight costs, the price equates to around US$7,830 per dmt.
Today’s announcement was about a further contract of sale for an additional 5,000 dmt cargo after completing the Battery Material Exchange (BMX) digital platform pre-auction sale process undertaken and announced on 18 October.
Today’s announced sale was priced at US$7,255 per dmt. That equates to a price of around US$8,000 per dmt when adjusting for lithia content and including freight costs.
A 5% deposit is required by early this week, with delivery expected from mid-November 2022.
My thoughts on the Pilbara Minerals share price
It has been an amazing year (so far) for the ASX lithium share. Since the start of the year, the share price has risen by around 50%.
Since 20 June 2022, it has gone up by around 160%. Earlier this year I said it could be cheap. However, I don’t think it’s cheap anymore. The lithium price has soared – I’m not sure how high it can go, or how long it will stay there. But, when the demand/price increases, it’s quite likely that new supply will be accelerated.
I believe that Pilbara Minerals’ future is very promising and I’m a big fan of its moves to get involved with the lithium supply chain. But, sometimes it’s something unpredictable that can knock a share price down – like a pandemic or rampant inflation. If there is a time of weakness for the Pilbara Minerals share price, then that could be the time to jump on the promising miner.
