Looking at the future
Buying Twitter proved to be a difficult task for Elon Musk, so now he is looking for other lucrative investment opportunities.
He can afford it
Obviously, being the richest man in the world makes you look at the world of business and investment from a different point of view than ordinary mortals. But what is the investment that Elon Musk currently recommends?
Lithium refining
Elon Musk has been enthusiastic about what could be his new business venture: lithium refining.
Investor Tip
At Tesla’s quarterly results presentation, CEO Elon Musk even urged his investors to bet on lithium refining.
“A license to print money”
According to Bloomberg, he justified his stance by stating that investing in lithium would be “a license to print money.”
A safe investment?
Moreover, Elon Musk assures that it is an investment that “cannot be lost”, and that now is the perfect time to invest as more and more car companies go electric.
Mining is not the same as refining
“I would like to urge entrepreneurs to enter the lithium refining business. Mining is relatively easy. Refining is much more complex,” said the businessman. “Lithium refining requires a lot of machinery and is difficult to scale,” said Elon Musk.
Lithium and software
Elon Musk has predicted that the lithium processing sector will reach “software-like” margins.
Battery supply
Why is there so much profit potential? According to Elon Musk, prices in the lithium sector have risen not because of raw material shortages but because of limited global capacity to supply high-purity lithium carbonate and hydroxide to battery supply chains.
Spectacular price increases
In fact, the price of lithium carbonate in China has increased by nearly 450% in recent months, according to Benchmark Mineral Intelligence.
China, the great lithium powerhouse
This situation has also been exacerbated by the fact that China currently accounts for more than half of the world’s lithium refining capacity.
Tianqi Lithium Corp
Since 2018, Tianqi Lithium Corp controls 46% of lithium production worldwide.
Cautious investors
Despite Musk’s enthusiasm, other investors are cautious. After all, a previous surge in investment in the lithium sector caused prices to fall, and they stayed low until 2020.
Some difficulties
As Bloomberg has reported, many suppliers of materials have encountered difficulties, from reduced production to delayed deliveries.
An industry on the rise
In addition to China, countries like Australia, Chile, Argentina and the United States already look at lithium refining as a sector to exploit in the short and medium term.
Electric vehicles
Despite the fact that lithium is abundant in nature, the process to refine it is very complex. However, electric cars will rely heavily on this material, which means the idea of investing in this sector could have some merit.
