EV Demand Driving Significant Deals in Top AU Miners

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Electric vehicle (EV) demand steadily rises as motorists become increasingly conscious of their carbon footprint. As many manufacturers race to accommodate the market, so are mining companies that produce the essential materials required to build EVs.

Many Australian mining companies are now back on the deals table as they scramble to acquire exclusive deals with as many EV manufacturers as possible. 

According to many experts, the demand for Australian lithium is set to grow as other lithium-producing countries make significant changes in their policies. India’s import of Australia’s lithium, as it aims to become a net-zero country soon.

Glyn Lawcock, head of resources at Sydney investment bank Barrenjoey, stated, “Chile’s decision could slow down investment into the country, which is probably slightly positive for the lithium world, and it may force the majors to pour in more investment dollars outside of Chile.”

Lawcock added that the decision of the Chilean government would allow Australian lithium miners an advantage in the market. Australia is the world’s largest lithium producer, making up half of the global supply. And with the other countries’ policy changes, Australian mining giant Pilbara Minerals jumped to 5.2%.

Writer Rhiannon Hoyle said, “So far this year, mining companies have announced more than $65 billion in pending and completed deals, according to data provider Dealogic. That number is nearly double the $36 billion announced in the same period of 2022, and the highest amount to start the year since 2012 when China’s breakneck growth led to a surge in deals.”

Hoyle added that despite the increased combined deals, there is still no guarantee that the transactions disclosed for the year will be completed. But despite that, mining companies’ appetite for discussing the deals table will remain strong.

Gavi Friedland of Goldman Sachs also noted that the world is changing rapidly, leading miners to acquire smaller players to boost their reserves. Many believe this trend will continue as the Australian government has created different laws to support this trend, such as delaying charging additional taxes for electric car vehicle users.

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