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A Solution to Our Biggest China Problem

Written by Alex Koyfman
Posted September 6, 2022

Dear Reader,

While the media continue to focus on Chinese political and military ambitions in Taiwan, the reality of the Chinese threat runs far deeper than new aircraft carriers, hypersonic missiles, and fifth-generation fighter aircraft.

As of last summer, of the 200 largest lithium-ion battery production facilities in the world, 148 were located in mainland China.

Europe's total, at that same moment, stood at 21, with the U.S. trailing behind both at just 11.

This bleak reality stands in stark contrast to common Western perceptions of the lithium-ion industry, given the attention that the electric vehicle revolution and renewables receive in Europe and North America. 

And yet it's the truth, despite what most of us so desperately want to believe.

In all, at this present day, the Chinese control more than three-fourths of the global lithium-ion production — 77%, to be exact, as of last summer.

They also control a majority of lithium mining exploration, which means that no matter what we do to try to close the production gap, the Chinese already own the future of the lithium-ion battery space.

There is literally nothing that can be done.

Stop Following Elon on Twitter

"But what about Tesla?" one might ask. How can the world's most famous, wealthiest EV-maker possibly retain its spot at the top of the pyramid when the balance of power rests with one of our most hostile political rivals?

Simple. Tesla itself relies on Chinese battery production, getting the lion's share of its own supply from Chinese industrial giants such as CATL and BYD.

It pays to mention that BYD, on top of being one of the world's biggest battery-makers, is also the biggest EV producer on the planet when measured by volume of units delivered.

Sorry, Mr. Musk. Your inflated share values only go so far when you're competing against a carmaker that can build and sell cars for a fraction of the cost.

Unfortunately, this disparity will only get worse as the world continues to step away from internal combustion as the primary power source for personal and civil transportation.

And with the growing disparity, so too will China's influence and wealth as more and more terawattage becomes completely dependent on Chinese lithium-ion cells.

Nothing Big Happens Overnight

This did not happen by accident. The Chinese have been planning this takeover for decades, quietly buying up resource-bearing properties, constructing the world's most massive factories, and sealing deals with the world's biggest producers of EVs and consumer electronics. 

If their plans come to fruition, global war, in the traditional sense of the word, may not even be necessary, as China will be able to control all of their geopolitical rivals indirectly by maintaining a chokehold on what is essentially the oil of the 21st century.

Is all lost? Is humanity's future now in the hands of one of the most oppressive regimes in existence today?

Perhaps not.

There is one secret weapon that the free world is developing right now that may have already thrust a spear's tip through the heart of this charging beast.

A new battery is currently under development in Australia, and it requires no lithium at all.

At its heart, a highly advanced nanomaterial known as graphene takes the place of lithium.

Graphene is an artificial fabric that boasts near-magical properties.

grapheneelectronics

It's a single molecule thick. A sheet of it big enough to cover a football field would weigh less than a gram. It's 200 times stronger than steel and is a remarkable conductor of both electricity and heat.

 

The Most Important Innovation in Materials Science Since Carbon Steel

Discovered just a few years ago, graphene won its chief researchers the Nobel Prize in 2010.

It was also incredibly expensive to produce, costing the price of a new Porsche for just one kilogram... That is, until one unknown material research firm based out of Brisbane figured out a way to dramatically cut that cost.

Today, this company is using its cheap graphene to make the world's most advanced rechargeable batteries, with properties that are in line with the capabilities of the raw material.

These batteries have up to twice the energy density of their lithium counterparts, have up to three times the service life, and charge up to 70 times faster.

A Tesla Model S equipped with a graphene battery pack could go well over 1,000 miles on a single charge and could not need major overhauls for over 1 million miles.

It would also charge to full capacity in less than a minute — a factor that completely changes the economics of the electric vehicle industry all by itself.

Imagine recharging your EV faster than you could pump half a tank of gas at the filling station. That's the level of improvement we're looking at.

These batteries were only theoretical a few years ago, but today small coin and pouch batteries are already coming off the assembly lines on their way to corporate clients for testing and evaluation.

Is Lithium-Ion the Next Betamax?

By the end of the decade, the lithium-ion industry could easily be on the decline as graphene-ion cells take over sector by sector.

As you may have expected, the Chinese are aware of the problem, but now they're the ones playing catch-up.

The company that's leading this charge is currently valued at less than USD$250 million — equivalent to about 0.5% of the current global lithium-ion industrial market cap.

It's an even smaller drop in the bucket compared with where demand for rechargeable batteries will be in five years.

As I've said to my colleagues, family members, and subscribers alike, this Australian materials company could well be the cheapest tech stock trading on any exchange, anywhere in the world.

And it happens to be currently trading on two exchanges in North America, which means that you could, if you were so inclined, own shares within just a few minutes, as they can be purchased on any major online stock trading platform.

Smart investors don't make rash decisions, which means it will pay to do your due diligence if you're even thinking about investing, but, as I've already mentioned, this firm is flying under the radar.

Neither the mainstream press nor big finance has done much with this story.

And that's to be expected. Small companies like this are usually the domain of private equity and a handful of farsighted, risk-tolerant independent investors.

Since most of my readers fall into the latter category, I've decided to make finding crucial information easier than ever by putting together a thorough video presentation on the company, the tech, and the future of the battery industry.

It's one of the most important pieces of media our video team has ever created, and today, you can get access to it absolutely free of charge.

We won't even ask for an email address.

It's that important.

To learn more, enter here.

Fortune favors the bold,

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Alex Koyfman

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His flagship service, Microcap Insider, provides market-beating insights into some of the fastest moving, highest profit-potential companies available for public trading on the U.S. and Canadian exchanges. With more than 5 years of track record to back it up, Microcap Insider is the choice for the growth-minded investor. Alex contributes his thoughts and insights regularly to Wealth Daily. To learn more about Alex, click here.

 

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