Super guide: everything you need to know about ASX vanadium stocks

Date: Oct 29, 2018

In coming weeks Stockhead will publish a series of “super guides” covering everything you need to know about the hottest ASX small cap themes — including the popular battery metals and other key investment areas.

Today we begin with a vanadium super guide, outlining the metal, the market, the outlook and key ASX stocks along with their recent performance.

Vanadium is a battery metals firecracker right now, with the price continuing on a rapid upwards trajectory.

Of all the so-called “battery metals” needed in modern energy storage devices, vanadium has attracted perhaps the most attention from ASX small cap investors in recent times. Vanadium stories have been among the most popular among Stockhead readers in 2018.

There are 40-odd ASX listed stocks that offer exposure to vanadium. (See below for a full list).

While the price of vanadium has been rocketing, more than 60 per cent of vanadium stocks lost ground in the year to October 2018.

The stocks fell especially in the three months leading up to the October stockmarket correction. About 37 of the 39 vanadium stocks in our table below lost between 3 and 65 per cent of their value.

That may be good news for investors though, because market watchers suggest vanadium mining companies provide a great long-term investment opportunity.

In this guide, Stockhead explains the factors that have been driving vanadium stocks, and what will spur demand — and stock prices — into the future.

What is vanadium?

Most vanadium is used in steel-making. Over 90 per cent of the commodity is added to steel to make it stronger.

Vanadium was initially discovered in 1801 by Spanish scientist Andres Manuel del Rio — who called it “erythronium” at the time.

The commodity was forgotten about until Swedish chemist, Nils Gabriel Sefström, happened across the mineral in 1830 and it finally got the name vanadium — the Scandinavian goddess of beauty — because of the beautiful colours of its compounds in solution.

It wasn’t until the early 20th century that vanadium’s considerable strength was discovered.

That made it the material of choice for things like planes, cars and buildings.

Vanadium started to be used industrially over a century ago, with its first application being in the vanadium-steel alloy chassis of the Ford Model T car.

But it hasn’t been until the last few years that the excitement around vanadium has really taken off.

The reason for that is its application as a battery metal. Vanadium is the key commodity in what is known as a “flow” battery.

Vanadium redox flow batteries (or VRFBs) are better suited to large scale applications (stationary storage), such as network support for electricity grid operators and telcos looking to power off-grid communications towers and utility scale installations.

Vanadium batteries are safer than lithium-ion batteries, cheaper than other types of “flow” batteries, and have the longest life spans, lasting more than 20 years or up to 25,000 cycles.

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