Rapid price movements and the relative immaturity of the market will likely lead to ongoing uncertainty, according to the Department of Industry, Science and Resources, adding that should supply concerns ease prices could fall more quickly:
“While expansions to production are already underway in Australia and overseas, there are long lead times for lithium mine and brine operations. Moreover, the potential for delays in bringing such large volumes of lithium into production, mean risks remain of persistent supply shortages over the next few years.
“However, one of the drivers of recent high spot prices appears to be a push by refiners and battery makers to build up inventories, due to concerns about global supply chains. The lack of data on global lithium stocks makes it difficult to judge how well battery producers have built up stockpiles.
“If these concerns ease, prices could moderate more rapidly over the outlook…
