(Bloomberg) — Lithium prices extended their yearlong rally as surging demand spurs a shortfall of the key battery material.
Prices have more than doubled in the past year, according to a Benchmark Mineral Intelligence index of lithium carbonate and hydroxide. Demand for the materials used in electric cars and renewable-energy storage has soared and, while miners are seeking to boost supply, there’s not enough to meet consumption.
“The financing for lithium projects is still too little, too late,” said Cameron Perks, a Melbourne-based analyst at BMI. “The market deficit is already occurring.”
A lengthy slump since 2018’s peak meant investment in the sector slowed, while the pandemic has exacerbated supply constraints. On the demand side, the green energy transition has accelerated the adoption of electric vehicles and global lithium consumption is estimated to grow fivefold by end of this decade, according to BloombergNEF.
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