ShreeMetalPrices: World Largest Lithium Producers sees Higher Prices – Demand will outpace Supply


Despite plans for increase in output, the world’s largest producer of battery metal, Albemarle, said today that lithium prices may possibly stay high for years.
Eric Norris, Company’s head of lithium, stated that a major shift in the lithium market would be a reason for the long demand.

The market is significantly different, according to Norris , and it is one of the causes why things are so tight. “The market was 300,000 tonnes in 2019 and didn’t rise very much. There may have been 30,000–50,000 tonnes of growth in a year.

The Albemarle Executive said, noting that the median size of a new lithium plant was approximately 5,000 tonnes. “Today, the market increases 200,000 tonnes a year, virtually the whole scale of what the market was before then.”

The expected demand for lithium, which is essential for EV batteries, would not be satisfy even with such growth rates. There is not sufficient lithium being produced right now, and there won’t be for a while, according to the most recent EV sales and anticipated sales figures, since demand is outpacing supply.

Due to this unbalance inside the lithium market, some experts predict a supercycle for battery metals as long as EV sales predictions remain intact, which is far from definite: as prices for not only lithium but also many other metals rise, EV prices rise as well, making them less appealing to purchasers.

However, not every analyst is as hopeful about lithium. Goldman Sachs predicts that after reaching $80,000 per tonne in 2022. Lithium prices will decline to $11,000 per tonne by 2024 due to China’s overproduction of EVs and the started opening of new mines.