EVs have lithium booming — and this time, there is no bust in sight – by Yvonne Yue Li and James Attwood (Bloomberg News – October 27, 2021)


Lithium is hot—again—though this time the rally looks to have more staying power. The market has exploded, with a benchmark index more than doubling in 2021 and key prices in China hitting records.

Driving the frenzy is the silvery metal’s allure as a commodity of the future: It’s one of the key components for the rechargeable batteries used to power electric vehicles.

Lithium has been down this road before. Prices more than tripled from early 2015 to a record in March 2018, only to collapse again as output rapidly expanded. Analysts and experts say this time is different because the EV boom has well and truly started. Producers have also learned their lesson from the last crash and are now preaching discipline.

The upshot is that supplies are tight enough to force battery makers to take on long-term contracts that are more favorable to producers. Some are even taking the bold step of buying up mining assets. In the end, lithium prices could be so high that it raises costs for batteries and EVs just as the world needs more clean-energy sources.

For the rest of this article: https://www.bnnbloomberg.ca/evs-have-lithium-booming-and-this-time-there-is-no-bust-in-sight-1.1672775