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Nemaska Lithium: Another One Dead And Gone

Mar. 04, 2021 1:56 PM ETNemaska Lithium Inc. (NMKEF), NMX:CA10 Comments
Tim Worstall profile picture
Tim Worstall


  • Nemaska Lithium went bust, the assets have been transferred, the stock doesn't trade, there's nothing left here.
  • There is a mild interest in that a new form of bankruptcy reorganisation was used under Canadian law to take care of the problem.
  • More importantly, for us, it's another proof that just being in the right, sexy, sector is no guarantee of success at all - even lithium and EVs.

Everything lithium is a go, right?

It's easy enough to think that booming demand for a material or a sector means that everyone in the sector is going to do well. That's not quite how markets work and Nemaska Lithium (OTC:NMKEF) is a useful example for us.

Nemaska(Nemaska Lithium from Seeking Alpha)

The reason the chart isn't available is that Nemaska has gone bust and there's no trade in the stock. Anyone holding the old equity has nothing but a tax write off to look forward to.

The lithium market

Sure, we can all agree that electric vehicles are where it's at right now. Varied countries – the UK and the EU for example – have already announced that internal combustion engine vehicles may not be sold in those places after a certain cut off date. 2030 for straight ICE for the UK, 2035 for hybrids, just as an example. No other technology than battery powered is going to be ready for prime time by then is my best guess. Fuel cells have their benefits but I don't see the hydrogen infrastructure as being in place by then. Nor is it likely, to my mind, that a battery technology other than lithium will be ready for mass manufacture by then – it is, after all, only 9 years away. Product development to mass manufacturing can and does take a long time.

So, yes, there's going to be a boom in the use of lithium. Quantities to be used will rise. We don't have to believe that paragraph above, that fuel cells and other batteries won't be available, to know that lithium use is going to rise, it's obvious that it will whatever.

Lithium prices

That lithium use will rise does not mean, necessarily, that lithium prices will rise. Price is dependent not upon

This article was written by

Tim Worstall profile picture
Tim Worstall is a wholesaler of rare earth metals and one of the global experts in the metal scandium. He is also a Fellow at the Adam Smith Inst in London and an writer for a number of media outlets, including The Times (London), Telegraph, The Register and even, very occasionally indeed, for the WSJ. This account is linked with that of Mohamad Machine-Chian: https://seekingalpha.com/user/52914142/comments

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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