ASX-listed Firebird Metals (ASX:FRB) is taking a bold approach to the battery materials industry by joining forces with China, rather than trying to compete against the country’s supremacy. With a market cap of $23.5 million, Firebird is pursuing a battery-grade manganese operation in China, inside an established chemical “park.”
The benefits of being inside the park are significant, including streamlined permitting and approvals processes, as well as the ability to take advantage of the circular economy. Chinese billionaire Zhenhua Pei and Australian investor Tolga Kumova are both backing Firebird’s strategy, with stakes in the company.
While traditional thinking would lead Firebird to develop its Oakover manganese project first, the company’s managing director, Peter Allen, has decided to prioritize supplying manganese ore from third-party sources for the battery grade plant in China. This move is all about capturing higher margins for the production of high purity manganese sulphate monohydrate (HPMSM), which is used in lithium manganese iron phosphate batteries.
Consultants like Benchmark predict that 51% of all battery cathodes will include manganese by 2030, and with China being the largest market for the material, Firebird is well-positioned for success. With a Chinese-style feasibility study estimating a capital cost of $US83.5 million for 72,500tpa of production, Firebird is looking at fat margins in a high-demand market.
With final permitting expected before the end of June 2024 and detailed feasibility studies on the horizon, Firebird is in a strong position to capitalize on the growing demand for battery materials. Evolution Capital has even put a 64c price target on Firebird, highlighting the potential for the company’s success in the industry.
