https://www.aspistrategist.org.au/
Early 2024 has not been kind to investors in critical minerals. Media outlets across Australia have run with headlines talking of ‘crash’, ‘crisis’ and ‘collapse’, with many blaming China and Indonesia for the slump— especially in nickel prices. This is in stark contrast to the extreme bearishness in 2022 and 2023.
Alarmingly, some players are using this ‘crisis’ to call for government bailouts and softer regulation. Others, including Minister for Resources and Minister for Northern Australia Madeleine King, are pushing for global green mining standards and a premium price for nickel produced with higher environmental standards.
Since January 2023 the spot price of nickel on the London Metals Exchange has fallen by over 50%, while the price of spodumene (the raw mineral containing lithium) in China has fallen by almost 70% from all-time highs. However, the story here is more about the exceptional prices of both nickel and lithium, through 2022 and into 2023 when global demand outstripped supply and stockpiles dwindled.
Benchmark Minerals Intelligence analysts argued recently that we have witnessed a classic commodity bubble bursting—this is more of a correction than a crash. Lithium is still priced at more than double pre-pandemic levels, while nickel is up 28% on 2019 prices.
For the rest of this article: https://www.aspistrategist.org.au/the-critical-minerals-bubble-has-seemingly-burst-what-does-it-mean-for-australias-geopolitical-strategies/