And you’ve seen it in the marketplace today and why I mentioned earlier on the call, the Cliffs bid for U.S. Steel. I think, where we sit in this cycle of the commodity cycle is, folks are very focused on supply chain resiliency, sourcing their feedstocks for global steel production and vertically integrating. Cliffs have done a great job of it. They’re a great example, and they continue to be aggressive in the market. I think that’s part of it as well. I think it’s a macro trend of producers in the global steel markets looking at vertically integrating their supply chain and sourcing material.
Mike Niehuser: Well, I know that the quality of the Wyoming County is something else. And so, I think that gives us kind of a clue as to how others might be looking at you for that supply chain resiliency. So that’s a good – another good answer, Mark. Also, before I forget, congratulations to Taylor, really a competent hands on big picture guy. So I think this is great for him, but be careful what you want. And on shifting – oh, go ahead.
Mark LaVerghetta: No. Well, I appreciate that. I’m sure Taylor appreciates that. And you’ve, like I said, we appreciate your interest. And I know you’ve spent – you spent a good part of the day with tireless, touring our assets.
Mike Niehuser: He’s the man.
Mark LaVerghetta: Yes.
Mike Niehuser: So on the lithium side, could you just define – I’m not the lithium guy at ROTH, but what is manufacturing scrap for lithium? I that from I guess, what’s left over on the cutting room floor at a battery shop? Is that what that is?
Mark LaVerghetta: Yes. I think, at a high level best way to explain it and I said it earlier, we – from our perspective, we believe the energy storage market, and it depends on the application, whether it’s just general energy storage, electric vehicles, small power tools or things like that. Everybody uses a different battery. Your cell phones using LCO typically or your laptop using LCO battery chemistry. EVs have kind of been a mix between NMC, nickel, manganese cobalt, and LFP lithium ion phosphate. It’s migrating more towards LFP, in our opinion, just given the – you don’t need the nickel cobalt, which are high price commodities that go into the chemistries of an NMC, lithium ion phosphate, the lithium is relatively valuable.
Iron phosphate carries less of a value. So the inputs on that – the difference between the two is the energy density. NMC can carry a higher energy density, but as we state, battery technology continues to evolve at a rapid pace. And you’re starting to see good energy density in LFP, it provides a little bit better safety characteristics as well. So the market is migrating more towards that as the energy density, safety, and less expensive feedstocks that go into the production of an LFP battery chemistry. So you’re starting – you’ve seen Tesla announced LFP giga-factories, Ford is, in the like. So EV is definitely migrating more towards an LFP battery chemistry. And when you’re manufacturing cathodes or batteries, there’s a lot of waste.
It’s a messy process. When you spray coat your cathode material, you trim it for sizing, there’s a lot of waste in the process. I think it’s estimated there’s about 20% waste currently. I know battery manufacturers want to reduce that. But they’ll not – our understanding is they’ll never get to zero and trimming it to very low levels is going to be very hard just given the inherent capability. So there’s a lot of scrap material that goes into the process. Our ability to take that scrap and recycle it back and into high purity forms, having the ability to modulate and co-locate with certain parties gives us a very strategic advantage of when you’re looking at domestic manufacturing because logistics matter, input prices matter and we’re able to reduce that, able to do it in a collaborative manner to reduce the cost structure for everybody.
