Lithium market to see only moderate rebound — Fastmarkets

Price reporting agency Fastmarkets has projected that any lithium market recovery will nonetheless see prices remain below their peak, after the metal’s value fell on average by 60pc since the beginning of the year. Analyst Jordan Roberts expects that “more sensible buyer behaviour and evolution in contracting practices” will temper any recovery below 2022 highs.

Roberts cites “increased supply, destocking dynamics, lower downstream demand and bearish sentiment” for the original fall in price, which has seen lithium carbonate plumet from a high of c.$80/kg in Q4 2022 to $32/kg as of mid-May. The analyst expects lithium pricing to remain volatile with the potential for future, if less extreme, price spikes. But the Fastmarkets’ view is that the overall trend for the next two years is for lower prices on average.

These projections are despite forecasts for strong demand from the battery sector, with Fastmarkets seeing lithium battery demand increasing from under 1mn t in 2023 to c.3.5mn t in 2033. The EV sector will remain the dominant demand driver for lithium-ion batteries, with 80pc to 85pc of demand coming from the industry by the end of the next decade.