LONDON, July 11 (Reuters) – Lithium boom has turned to lithium bust over the last two years as a wave of new supply overwhelms weaker-than-expected demand for electric vehicle (EV) batteries.
The CME contract for lithium hydroxide has collapsed from a 2022 high of $85,000 per metric ton to $11,930. The CME carbonate contract was above $40,000 when it began trading in July 2023 and has since slumped to $12,850.
Lithium has been here before. There was a similar boom-bust cycle in 2016-2017 but the difference this time is that no-one seems to be expecting a speedy recovery. The short-term outlook is for prices to trundle along at the lows as the market digests surplus material.
The longer-term picture is more positive as governments force the transition to electric vehicles but there will be no return to the giddy heights of 2022 in the next 10 years, according to analysts at BMI, a Fitch Solutions company.
For the rest of this column: https://www.reuters.com/markets/commodities/after-another-boom-bust-where-next-lithium-andy-home-2024-07-11/