Lithium Price Drops More than 70% in a Year

The metal symbol of the race to electrify transportation has come to a halt. The price of lithium has been steadily declining and fell by more than 70% in 2024.

An oversupply, particularly of Chinese production, combined with demand that has grown less than expected, particularly related to lower-than-expected growth in electric vehicle sales, has resulted in “White Gold” increasingly depreciating. According to Italian economic newspaper Il Sole 24 Ore, lithium carbonate has fallen below $13,000 per ton, and lithium hydroxide has fallen to about $12,000, the level of three years ago.

This dynamic, however, doesn’t seem to bother the world’s major producers gathered on June 24-27 at the Fastmarkets Lithium Supply and Battery Raw Materials Conference in Las Vegas. Manufacturers are actually still optimistic about long-term demand for the key metal used to make batteries, even though the recent price collapse has led to layoffs in the sector and curtailed expansion plans for several industry players. The optimism stems from the fact that electric cars and energy storage batteries will become increasingly common in the coming years (either way, electric car sales worldwide grew more than 10% in the first 4 months of 2024). According to Fastmarkets, as reported by Reuters, US lithium demand will increase 29% each year through 2030.

At the same time, however, several car companies have dramatically slowed, if not scaled back, their electrification plans. For example, BMW, as reported by Il Sole 24 Ore, recently canceled a $2 billion order with Swedish lithium-ion battery company Northvolt.