CRML Borrow Costs Triple While Short Interest Hits New Highs

Critical Metals Corp. has seen its borrow market remain under severe strain since the last note, with cost to borrow more than doubling again and short interest climbing to a fresh high, even as a brief window of relief in the lending pool has now mostly closed back up.

The most important update since the October 14 note is that the situation has changed, but not in short sellers' favour. Availability, which had briefly recovered from near-zero to around 15% on October 19, has tightened back to 7.8% on October 20. That is a long way from the complete lockout seen on October 13 to 15, when availability hit 0.002%, but it is still extremely tight: roughly 1 share available for every 13 already borrowed. More striking is what has happened to cost to borrow. It was 74.7% when the previous note was filed. It has since hit a peak of 158.9% on October 16 and was still at 130.3% on October 20, up 74% on the week and close to 400% above where it was a month ago. Holding a short position here is expensive in a way that compounds by the day.

Short interest has continued to drift higher rather than capitulate. At 27.1% of free float, the position is up around 30% over the past month, and the week-on-week move is marginally positive at 0.3%. That month-long build, from roughly 22% to 27% of float, is what drove the borrow market to its current state: more shares demanded as collateral, fewer left available to lend. The stock itself has fallen 1.7% in a day and 2.1% on the week to close at $6.40, down nearly 5% over the past month, so short sellers have so far been right on direction, but they are paying heavily for the privilege.

The ownership structure adds a layer of complexity that is unusual even for a small-cap miner. European Lithium Limited sits on a 13D filing and holds 37.3% of the class, down from 39.5% at the prior filing. Gregory Bennett Barnes filed a fresh 13D in May 2026 at 11.5%. Two confirmed activists controlling close to half the shares outstanding means a meaningful portion of the float is effectively locked. ORTEX forecasts an 84% probability of a Russell 2000 share-count increase tied to the agreed European Lithium takeover, with an estimated $54 million of index-tracker buying required if the rebalance goes ahead, on dates currently estimated around December 30 to 31. That is a mechanical flow figure, not a price call, but it adds to an ownership picture where free float is already constrained and contested.

Analyst coverage is thin and the most recent action is stale enough to carry a caveat. Freedom Broker downgraded the stock to Hold from Buy in August 2026, cutting its target to $8 from $17. That downgrade followed a Cantor Fitzgerald initiation at Speculative Buy with an $18 target in July 2026. The single consensus hold rating and a mean target of $13, against a current price of $6.40, reflects a wide spread of opinion rather than any settled Street view, and both targets predate the latest deterioration in the borrow market and the stock's continued slide.

Earnings history points toward caution into the December 11 event. The last three prints produced next-day moves of minus 6.0%, minus 6.4%, and minus 8.3%, and all three also saw the stock down 12% to 14% over the following five days. The one exception in the dataset was June 2026, which produced a single-day gain of 6.8% that then faded over the week. The next print on December 11 is therefore worth watching less for any fundamental surprise and more for how the borrow market and the ongoing activist ownership story interact with whatever the results deliver.