auto

Surge in electric vehicle sales power lithium prices as shortages loom By Reuters – Investing.com UK



© Reuters. FILE PHOTO: A electric car charging station is pictured in a parking lot in Shanghai, China March 13, 2021. REUTERS/Aly Song/File Photo

By Zandi Shabalala

LONDON (Reuters) – Lithium prices have jumped to their highest in more than three years thanks to an upsurge in electric vehicle sales, depleting stocks of the battery material in top consumer China.

Targets to cut carbon emissions from China to the United States cannot be met without the rechargeable lithium-ion batteries that power electric vehicles.

“Right now it’s very simple: the market is so tight that players are fiercely competing for any spot tonnage available,” said Max Deudon, a trader at Transamine in Geneva.

More investment in lithium production is needed to meet future needs of the electric vehicle supply chain, analysts say.

“Things are heating up and there is huge anxiety about where lithium supply is going to come from in the near future,” said Benchmark Mineral Intelligence analyst George Miller.

“If new lithium doesn’t start coming to market, we might start to see electric vehicle production rates hamstrung by a lack of raw material supply.”

Electric vehicle batteries can use lithium carbonate or lithium hydroxide, but the industry typically talks of volumes in lithium carbonate equivalent (LCE).

Graphic: Second charge: https://fingfx.thomsonreuters.com/gfx/ce/zjvqkjqaxvx/2ndcharge.JPG

Spot prices for lithium carbonate in China have climbed 170% so far this year to 142,000 yuan ($22,000) a tonne, their highest since April 2018. Prices of spodumene, a source of lithium mainly mined in Australia, have climbed 144% this year to $990 a tonne.

See also  Jeremy Clarkson and Amazon Prime smash-hit The Grand Tour return in epic style with 14 new episodes

In China, the biggest market for electric vehicles, lithium carbonate output in August rose 19% year-on-year to almost 20,000 tonnes, state-backed research house Antaike said.

Demand for lithium is expected to jump 26.1% or about 100,000 tonnes of LCE to a total of 450,000 tonnes, flipping the market into a deficit of 10,000 tonnes, according to Benchmark Mineral Intelligence.

Graphic: Lithium deficit: https://fingfx.thomsonreuters.com/gfx/ce/zgvombmabvd/lithiumdeficit.JPG

Global sales of electric vehicles were up 150% in the seven months to July to just over 3 million units, compared to the same period in 2020, with about 1.3 million sold in China, according to consultancy Rho Motion.

Graphic: EV sales: https://fingfx.thomsonreuters.com/gfx/ce/akpezqzeavr/electricvehiclesales.JPG

For 2021, Rho Motion expects electric vehicle sales to reach 5.8 million.

Higher prices have boosted the fortunes of miners with profits at Albemarle, Pilbara Minerals, Ganfeng and Tianqi Lithium soaring and share prices rising.

Graphic: Lithium miners: https://fingfx.thomsonreuters.com/gfx/ce/jnpweyejepw/lithiumminers.JPG

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

See also  New hybrid Ferrari supercar to be revealed tomorrow





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.  Learn more