Despite lithium prices halving in 2023, Battery Materials Review Managing Editor Matt Fernley is optimistic about the metal.
On Friday Fernley recorded Kitco Roundtable with mining audiences manager Michael McCrae.
This decade lithium went on a stellar run, trading up 10x versus historical levels, but in 2023 the metal took it on the chin. In 2023 Benchmark Mineral Intelligence estimates that lithium prices have been cut in half. Fernley is sanguine.
"It is just a reasonable cyclical downturn," said Fernley, noting that there have been production cuts in Asia that should help the metal. "We're already below the marginal cost of production for a number of assets in China. That's going to continue in April. I believe that lithium prices will pick up over the next couple of months."
Other news weighing on the metal is Tesla's price cuts. Growth is still strong, noted Fernley, who expects 25% to 30% year-on-year growth in European EV demand.
Lastly, CATL said it is making advances in sodium-ion batteries. Fernley said the technology still needs to scale, and the material has to be sourced in large quantities. Lithium ion will not be substituted by the new technology.
"It would be quite difficult for the sodium ion supply chain to ramp up capacity. The problem is getting pure enough sodium hydroxide or sodium carbonate to use in your batteries."
