Wednesday 22 February 2023

Despite drop, lithium still costs eight times more than last year

Despite drop, lithium still costs eight times more than last year

Chinese lithium prices have dropped by 30%, however this still represents eight times the value of the metal at the start of 2022.

That’s according to pricing agency Fastmarkets, which claims the value of the key element in manufacturing electric vehicles (EVs) now sits at $61,795 (£51,000) per tonne.

The price of lithium shot up from 2021, after there was a global scramble for carmakers to turn to building electric cars – but this interest has slightly waned recently.

In the final quarter of 2021, the value sat at around $20,000 (£16,500) per tonne – displaying the huge jump in prices the market has seen in the last couple of years.

The peak of value for Chinese lithium carbonate was more than $80,000 (£66,000) per tonne in November of last year.

Domestically, China has witnessed a dip in citizens buying EVs – with a 6.8% drop in purchase numbers this January, when compared with the same month two years ago. That’s according to the Chinese Passenger Car Association.

With trends suggesting that the huge demand from drivers will be much lower in 2023 than it has been since the first quarter of 2021, the price of the prized element has taken a hit.

However, the report reveals that no matter the extent of the drop in purchases this year, it will be highly unlikely the value of lithium will reach what it was at the beginning of last year.

Written by

Bruna Pinhoni

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