Warnings of a lithium glut may be premature. For one thing, doomsayers assume all the lithium in brine or hard rock deposits will get processed, but that’s not the case, said Jay Roberge, partner and managing director at Tehama Capital Corp., a Vancouver-based merchant bank.
“There’s no shortage of lithium in the world, but the concern is processing it and developing it into lithium carbonate, lithium products and lithium metal,” Roberge said in an interview.
“Not all lithium projects that will have a decent grade of lithium are necessarily economical, because you have to be able to process the lithium into the end-product.”
Surging demand for lithium in batteries for electric vehicles has caught the attention of investors in the past two years. Still, more output may be on the way.
Morgan Stanley cautioned in February that excess supply will come as soon as next year, while Wood Mackenzie Ltd. has said supply is likely to outpace demand more aggressively, spurring a price decline from 2019.
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