Lithium prices have maintained a steady level following their previous record highs.
In the world of battery-grade lithium, prices have been on a steady upward trajectory this year. Chinese battery-grade lithium carbonate prices have seen a significant increase of 90% year to date, setting them apart from the declining prices of other battery metals.
This trend continues, with both Chinese technical and battery-grade lithium carbonate prices continuing to rise. Interestingly, the Inflation Reduction Act in the United States has not been mentioned as affecting these price increases directly.
The prices of lithium hydroxide and lithium carbonate have both increased significantly compared to their prices at the beginning of the year. Lithium hydroxide prices, in particular, have seen a staggering 127% year-to-date increase, surpassing the rise in lithium carbonate prices.
Despite these increases, average lithium prices have remained stable since April's record high levels. It's important to note that the Inflation Reduction Act has not been linked to the stability of lithium prices or the marginal increases in Chinese battery-grade lithium carbonate prices since the beginning of June.
The focus of the need for lithium sources, accelerated by the Inflation Reduction Act, is particularly in North America. Key lithium suppliers in North America supporting the automotive sector amidst rising demand include emerging companies like Lyten from Silicon Valley. Lyten, backed by automotive investors like Stellantis, acquired major assets from European battery manufacturer Northvolt to establish secure local supply chains in the US.
Kreisel Electric, another notable player, has plans to open a US branch to serve the growing electric mobility market. Northvolt, while primarily based in Sweden, is connected to US efforts through Lyten. While many leading lithium-ion battery manufacturers are based in China, North American efforts focus on building regional capacity and partnerships to reduce dependence on imports.
This shift towards regional lithium sourcing is a strategic move, given the stark contrast between the rising lithium prices in China and the declining prices of other battery metals such as cobalt and nickel. The Inflation Reduction Act has indeed accelerated the need for automakers to secure lithium sources, with the focus particularly in North America.
