February 2024
The global lithium market is facing unprecedented instability due to a prolonged and substantial decline in price, coupled with a slowdown in demand. This turmoil is creating chaos in the mining sector, halting projects, thwarting deals and instigating a desperate search for funds that is expected to echo through the industry for years.
In addition, the industry is contending with rampant inflation, escalating costs for new projects. Miners are responding by cutting production and implementing cost-saving measures, including workforce layoffs. This marks a significant reversal from the optimism of recent years that led to surging prices and prompted major players in the auto industry to secure future supplies. Anticipated downside factors such as reduced government incentives and insufficient charging infrastructure will weigh on EV sales in the short-term, with potential implications for lithium demand.     Australian lithium producers may face project cutbacks and delays like the nickel industry, due to supply growth and slower-than-expected EV sales. Both sectors are grappling with a significant decline in raw material prices.