Global Lithium Demand 2009 Sharply Down and Prices Set To Weaken. TRU Group Lithium Consultants

    TORONTO, ON / TUCSON, AZ, November 14, 2009 /24-7PressRelease/ -- Lithium demand has been hit hard through third quarter 2009 and we envisage a full year decline exceeding 12% over 2008. Lithium consultants TRU Group Inc says that there is no need therefore to update its well publicized January 2009 long range lithium outlook 2020 presented at the IM lithium conference. The next six months will be critical but a recovery is likely soon. The TRU distinctive forecast of lithium use in electric vehicles and lithium use in alloy is also proving correct. Thus no significant modification to our long range demand projection is necessary for the 2010 conferences.

The TRU view that global lithium oversupply will persist at minimum through 2013 is affirmed. Output of lithium chemicals through expansion by existing brine-based producers - SQM, FMC, Chemetall and CITIC - and new development projects in the pipeline will assure sufficient lithium supply long range. Additional new medium range production will originate from mineral-based producers in China particularly and likely Rincon Lithium (salar) of Argentina. We expect at least one new competitive brine producers to be in production within ten years.

Dominating lithium producer SQM in September 2009 announced 20% price reductions. Lithium prices have been flat through 2009 bolstered by the steep fall in the US dollar against lithium producer and user currencies. TRU president Edward R Anderson says "the SQM price reduction was a necessary correction and consistent with the TRU over-supply scenario. Indeed, there is little prospect for price volatility even long range. TRU projects an orderly and balanced development of the lithium industry through the 2020 horizon".

Since most lithium originates from Chile and Argentina there is little to threaten US lithium security as some will have us believe. Even if there were a breakdown in world order, lithium chemicals are readily stockpiled. Although minimal lithium battery capacity exists in the US this is being alleviated. Much of lithium technology generally originated in North America and we remain comparatively strong from raw materials through to end products. TRU itself has North American experts in most technical aspect of lithium production and application.

TRU assists companies from exploration, process engineering and lithium product design. In 2009 TRU technical assessed and ranked all the global 170 lithium salt lake salars and also the thirty pipeline mineral-based projects being promoted. TRU president Edward R Anderson says "The barrier to development for most projects is inadequate use of well qualified lithium engineering expertise. Lithium process engineering is highly specialized and too many of these start-ups have no experience in chemical plant project development. Missteps and some engineering failures are inevitable. Some projects will prove unprofitable because management underplay the competitiveness of the industry. Success of a lithium resource development requires solid state-of-the-art technology and the industry strategic skills to compete".

TRU Group Inc based in Toronto, Canada and Tucson, USA are lithium engineering and industry consultants with a strong capability in lithium project development, feasibility studies and investor due diligence. The TRU website link trugroup.com/Lithium-Market-Conference.html

Contacts -
Edward R. Anderson, President& CEO
Mailto:[email protected]
Tucson 520-575-0674, Toronto 416-935-1754
Cell 1-520-229-7836 Website http://trugroup.com/

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