Eye on Lithium: Goldman Sachs reality checks lithium (again) leaving only sadness and backwardation

Mining Rob Badman
goldman sachs lithium

Pic via Getty Images

What’s happening today with this and that, here and there, pertaining to the lithium market? Let’s find out. 

 

Hold your horses, futures contango followers and lithium spot price bottom fanciers. That is, if you take one set of big banker analysts’ words as gospel.

And that’s because Goldman Sachs is urging caution regarding the recent lithium rally, which now appears stalled.

That said it could still hit a higher gear or move into backwardation, reversing out a tight alley at speed. Yep… could go up, could go down. Hell, sideways, too. We’ll stick to the reporting…

Tuesday was one of the worst days for the majority of lithium stocks in a while, after major lithium companies dipped alarmingly.

That said, thankfully there’s been some recovery since then for lithium prices, per last check in with Lithium Price Bot.

Why did it dip, though? It’s being widely attributed to at least a couple of factors.

Firstly, the news that major global lithium player Albemarle is conducting a capital raise, per an SEC filing in which the company revealed it plans to raise US$1.9 billion through issuing 35 million new depository shares.

This has caused a stir in the US investment landscape, with knock-on effects to globally.

“This was unexpected news, as we view Albemarle’s balance sheet as healthy,” said Seth Goldstein, equities strategist at Morningstar.

Albemarle’s share price had been showing signs of recovery before plunging on the cap raise news, which left many an analyst scratching head.

With regard to Albemarle’s sell-off, Goldstein added: “We think the market is skeptical of a lithium price recovery.”

That said, he continued…

“As inventory destocking eventually ends, we expect lithium sales volumes will move closer to end-market demand, which we expect will see double-digit growth in 2024.

“As supply growth has slowed and some higher-cost supply exited the market, we expect the lithium market will revert to undersupply by the end of 2024, sending prices rising, particularly in the second half of the year. For lithium producers, including Albemarle, higher prices should provide a strong catalyst for shares to rise.”

 

The other factor, by the way, was a dip yesterday in the stock prices of EV big guns Tesla and BYD.

 

Not out of woods yet: Goldman’s bearish view

Goldman Sachs

Per a research note published overnight in the US, Goldman Sachs notes it believes it is still too early to call the end of the lithium bear market and an end to a battery raw materials price plunge in general.

For the coming 12 months, Goldman analysts said that the bank is targeting a 12%, 15% and 25% downside in cobalt, nickel and lithium carbonate, respectively.

“Despite the significant downside in battery metals prices, with nickel, lithium and cobalt prices down 60%, 80% and 65% from cycle peak, respectively, we believe it is too early to call a decisive end to these respective bear markets,” wrote the investment bank’s analysts in a note to clients.

“Margin pressures have generated a meaningful degree of supply rationing effects over the past quarter,” added the investment bank analysts.

 

However, here’s optimism from Citi and UBS

Citi

As reported by Carl Capolingua at Market Index, Citi analysts are also suggesting caution in their lithium outlook, despite demand growth remaining strong.

Citi says it’s “waiting on supply response at current prices”.

The broker has formed a view that “lithium prices have bottomed near-term and that long-term demand growth rates remain intact”,  wrote Capolingua.

UBS

The Market Index analyst also highlighted another prominent UBS, which suggested that since its last update on the lithium market, “more supply has been curtailed, slowed or delayed”.

UBS has cut its outlook on expected 2024 surplus from 142kt to 94kt.

“To put this into perspective, it’s the difference between 6 weeks of market supply and just 4 weeks,” wrote Capolingua, adding:

“Reasons for the curtailment include a slowing in Chinese lepidolite supply, environmental inspections in China, delays and production cutbacks at key major producers, and ‘new projects are being pushed out’.

 

ASX lithium form guide

Scroll or swipe to reveal table. Click headings to sort. Best viewed on a laptop. (Note: figures accurate per ASX at 3pm.) 

Stocks missing from this list? Email [email protected]

CODE COMPANY TODAY WEEK 1 MONTH % 12 MONTH % PRICE MARKET CAP
ADV Ardiden Ltd 4% -9% -19% -52% 0.145 $8,752,451
AGY Argosy Minerals Ltd -6% -2% 17% -83% 0.1225 $182,572,975
1MC Morella Corporation 0% -14% -25% -73% 0.003 $18,536,398
AML Aeon Metals Ltd. 0% 20% -40% -73% 0.006 $6,578,404
ASN Anson Resources Ltd -10% 11% 24% -51% 0.099 $141,540,103
AVZ AVZ Minerals Ltd 0% 0% 0% 0% 0.78 $2,752,409,203
CXO Core Lithium -5% 1% 23% -76% 0.2275 $512,864,531
EMH European Metals Hldg -6% 0% -2% -51% 0.3 $40,219,365
EUR European Lithium Ltd -5% -14% -14% 7% 0.074 $108,750,656
GLN Galan Lithium Ltd -5% 11% 18% -67% 0.39 $159,630,156
INF Infinity Lithium 0% 1% 0% -29% 0.078 $36,082,183
INR Ioneer Ltd -5% 2% 10% -61% 0.1375 $306,241,761
JLL Jindalee Lithium Ltd 3% -6% -13% -69% 0.795 $46,879,841
LIT Lithium Australia 0% -4% 0% -31% 0.027 $33,001,875
LKE Lake Resources -4% -4% 20% -82% 0.11 $163,768,108
LPD Lepidico Ltd 0% 0% 0% -54% 0.006 $45,829,848
LPI Lithium Pwr Int Ltd 0% 6% 1% 59% 0.565 $361,898,974
LTR Liontown Resources -2% 8% 40% -23% 1.25 $3,089,641,867
MIN Mineral Resources. 0% -1% 14% -28% 63.99 $12,491,931,392
MLS Metals Australia 0% -4% -13% -43% 0.027 $19,098,977
AKE Allkem Limited 0% -100% -100% -100% 0 $6,304,350,967
PLL Piedmont Lithium Inc -3% 12% 6% -77% 0.2125 $84,877,870
PLS Pilbara Min Ltd 0% 5% 19% -2% 4.08 $12,338,818,575
QPM Queensland Pacific -4% -4% -9% -64% 0.0355 $74,463,992
PSC Prospect Res Ltd -3% 1% -13% -66% 0.069 $32,896,569
RLC Reedy Lagoon Corp. 0% 0% 0% -54% 0.004 $2,478,163
SYA Sayona Mining Ltd -2% 5% 5% -83% 0.041 $432,318,433
TKL Traka Resources 0% -25% -25% -68% 0.0015 $2,625,988
TON Triton Min Ltd 7% 0% -6% -53% 0.016 $23,420,890
VUL Vulcan Energy 0% 13% 24% -59% 2.5 $431,903,250
GL1 Globallith 1% 19% 36% -63% 0.59 $152,255,200
BMM Balkanminingandmin 0% -3% -4% -80% 0.069 $4,901,795
LEL Lithenergy 4% 2% 57% -24% 0.55 $54,595,300
ARN Aldoro Resources 1% -18% -4% -63% 0.086 $11,443,018
NMT Neometals Ltd -2% 13% 13% -80% 0.1525 $96,535,599
IGO IGO Limited -1% 1% 11% -45% 7.66 $5,853,680,194
AAJ Aruma Resources Ltd 6% 13% -15% -73% 0.017 $3,150,264
PAM Pan Asia Metals 0% 0% 0% -57% 0.16 $26,850,684
AX8 Accelerate Resources 0% 15% 41% 11% 0.031 $18,909,111
AM7 Arcadia Minerals 0% -3% 4% -69% 0.07 $7,633,507
AS2 Askarimetalslimited -2% 4% -8% -84% 0.087 $7,083,306
BYH Bryah Resources Ltd 13% 29% -10% -59% 0.009 $3,483,628
EMS Eastern Metals 0% -11% -6% -54% 0.031 $2,555,214
FG1 Flynngold 10% -6% -18% -42% 0.045 $6,729,777
FRS Forrestaniaresources -14% -10% -22% -85% 0.018 $3,397,501
GSM Golden State Mining -9% 0% -9% -73% 0.01 $3,073,077
IMI Infinitymining 13% -19% -26% -52% 0.081 $8,550,244
LRV Larvottoresources -8% -5% -9% -60% 0.06 $14,534,757
MMC Mitremining -11% 0% 17% -7% 0.28 $28,086,948
RAG Ragnar Metals Ltd 0% 0% -9% 40% 0.02 $9,479,619
CTN Catalina Resources 0% -20% -20% -43% 0.004 $4,953,948
TMB Tambourahmetals -4% -11% 2% -23% 0.085 $7,381,691
TEM Tempest Minerals 0% 14% 14% -64% 0.008 $4,152,995
EMC Everest Metals Corp -5% -11% 0% -12% 0.076 $13,142,649
WCN White Cliff Min Ltd -6% 0% -6% 36% 0.015 $21,407,063
WML Woomera Mining Ltd 0% -20% -20% -67% 0.004 $4,872,556
AZL Arizona Lithium Ltd -4% 13% 24% -57% 0.026 $102,908,272
CRR Critical Resources 0% -11% 23% -66% 0.016 $28,445,604
KGD Kula Gold Limited 0% 13% 38% -53% 0.009 $4,162,157
LRS Latin Resources Ltd 2% 13% 59% 87% 0.215 $587,878,087
PNN Power Minerals Ltd 0% 20% 31% -50% 0.21 $18,348,981
WR1 Winsome Resources -1% 17% 61% -60% 0.86 $165,029,069
KZR Kalamazoo Resources 0% 1% 4% -39% 0.097 $16,955,943
MTM MTM Critical Metals -5% -21% 22% -34% 0.079 $10,316,598
QXR Qx Resources Limited -5% 5% 43% -47% 0.02 $23,311,635
SCN Scorpion Minerals 0% 67% 20% -56% 0.03 $12,283,686
AZI Altamin Limited 0% 15% 8% -22% 0.055 $24,136,697
ENT Enterprise Metals 0% 0% -25% -63% 0.003 $2,405,913
KAI Kairos Minerals Ltd 0% 8% -4% -29% 0.013 $34,071,858
STM Sunstone Metals Ltd 5% 17% 5% -68% 0.0105 $35,006,515
PGD Peregrine Gold -3% -10% -28% -52% 0.2075 $14,529,361
AVW Avira Resources Ltd 0% 0% -50% -67% 0.001 $2,133,790
NVA Nova Minerals Ltd 0% 2% -11% -49% 0.28 $59,049,217
GT1 Greentechnology -5% 46% 41% -72% 0.19 $63,750,419
BNR Bulletin Res Ltd -3% -4% -10% -30% 0.073 $22,020,999
CAI Calidus Resources -3% -3% -17% -36% 0.145 $91,894,073
MRR Minrex Resources Ltd 0% 0% 4% -58% 0.013 $14,103,278
A8G Australasian Metals 8% -4% -23% -52% 0.077 $3,700,555
EFE Eastern Resources 0% 14% 14% -50% 0.008 $9,935,572
MQR Marquee Resource Ltd 0% 5% 10% -24% 0.022 $9,094,456
SRZ Stellar Resources 0% 22% 57% 0% 0.011 $15,799,114
LSR Lodestar Minerals -25% -25% -25% -63% 0.0015 $4,046,795
NWM Norwest Minerals -3% 3% 19% -6% 0.031 $10,955,824
AOA Ausmon Resorces 0% 0% 50% -40% 0.003 $3,176,998
VKA Viking Mines Ltd 0% -9% -23% 0% 0.01 $10,252,584
IPT Impact Minerals 15% 25% 25% 67% 0.015 $37,241,151
SRI Sipa Resources Ltd 0% -5% -10% -34% 0.019 $4,335,005
VMC Venus Metals Cor Ltd 0% 0% -13% 7% 0.096 $18,213,954
RGL Riversgold -11% -11% -11% -60% 0.008 $8,708,953
ZNC Zenith Minerals Ltd 1% 4% -23% -56% 0.096 $33,476,184
RAS Ragusa Minerals Ltd 9% 57% 24% -65% 0.036 $4,705,760
G88 Golden Mile Res Ltd 10% 0% 0% -37% 0.011 $4,112,229
EPM Eclipse Metals 0% -14% -20% -67% 0.006 $12,450,325
EVR Ev Resources Ltd -4% -18% 15% -23% 0.0115 $13,855,060
WC8 Wildcat Resources -4% 14% 62% 2245% 0.68 $849,045,067
MNS Magnis Energy Tech 0% 0% 0% -88% 0.042 $50,378,922
RIO Rio Tinto Limited -1% 1% -4% -2% 124.05 $46,316,647,021
THR Thor Energy PLC 4% 0% -21% -53% 0.026 $4,604,303
YAR Yari Minerals Ltd 17% 40% -22% -63% 0.007 $2,894,147
MXR Maximus Resources 0% 6% 0% -6% 0.033 $10,591,210
DRE Dreadnought Resources Ltd 3% 3% 3% -76% 0.0185 $62,668,313
MM1 Midasmineralsltd 0% 4% -15% -43% 0.085 $7,373,516
M2R Miramar 0% -11% -27% -73% 0.016 $2,381,913
LLI Loyal Lithium Ltd 6% 2% 25% -25% 0.275 $21,654,703
LRD Lordresourceslimited 13% 4% -9% -73% 0.053 $1,745,210
WMC Wiluna Mining Corp 0% 0% 0% 0% 0.205 $74,238,031
AUN Aurumin 0% 18% 25% -20% 0.04 $14,737,723
ZEO Zeotech Limited 0% 15% -6% -51% 0.03 $52,002,692
ALY Alchemy Resource Ltd 14% 14% 0% -47% 0.008 $8,246,534
LIS Lisenergylimited -3% 0% -7% -53% 0.14 $92,829,033
GW1 Greenwing Resources 4% 4% -10% -68% 0.078 $13,593,861
KTA Krakatoa Resources -4% -21% -42% -72% 0.011 $5,429,233
TYX Tyranna Res Ltd 8% 18% -13% -38% 0.013 $39,449,104
DAF Discovery Alaska Ltd 0% 0% -20% -47% 0.016 $3,747,755
FTL Firetail Resources 0% 26% 0% -59% 0.058 $8,636,522
IR1 Irismetals -3% 27% 4% -43% 0.665 $88,731,463
LNR Lanthanein Resources 0% -40% -40% -83% 0.003 $5,564,727
DAL Dalaroometalsltd 0% -24% -24% -79% 0.016 $1,324,000
TKM Trek Metals Ltd 14% 18% 11% -41% 0.04 $17,957,690
CY5 Cygnus Metals Ltd -3% 7% -6% -82% 0.063 $18,951,344
TUL Tulla Resources 0% -100% -100% -100% 0 $118,262,971
WES Wesfarmers Limited 0% -2% 12% 36% 65.26 $73,812,257,122
LLL Leolithiumlimited 0% 0% 0% -6% 0.505 $498,553,663
OCN Oceanalithiumlimited -2% -5% -2% -82% 0.061 $3,352,743
A11 Atlantic Lithium -5% 7% 5% -41% 0.395 $269,612,657
CMD Cassius Mining Ltd -8% -68% -67% -67% 0.011 $6,504,054
VSR Voltaic Strategic -5% 11% 33% 0% 0.02 $10,145,182
SGQ St George Min Ltd -5% -5% -17% -71% 0.02 $20,759,349
LLO Lion One Metals Ltd 0% 0% -31% -36% 0.62 $9,586,267
PAT Patriot Lithium 11% 3% -42% -76% 0.078 $4,873,199
PL3 Patagonia Lithium -3% -12% 26% 0% 0.145 $7,369,275
BUR Burleyminerals 2% -3% -34% -81% 0.059 $5,991,212
CHR Charger Metals -4% -4% -8% -68% 0.115 $9,290,430
RMX Red Mount Min Ltd 0% 0% -20% -56% 0.002 $5,347,152
DLI Delta Lithium -2% 6% 10% -20% 0.3075 $224,223,187
LM1 Leeuwin Metals Ltd 0% -9% -16% 0% 0.08 $3,748,134
ENT Enterprise Metals 0% 0% -25% -63% 0.003 $2,405,913
FIN FIN Resources Ltd 0% 27% 12% 27% 0.019 $12,336,105
DTM Dart Mining NL -6% 14% 23% -66% 0.016 $3,868,854
NIS Nickelsearch -3% 0% -18% -58% 0.033 $7,260,443
EG1 Evergreenlithium 0% 5% -12% 0% 0.11 $6,185,300
MAN Mandrake Res Ltd 0% -5% 0% -24% 0.038 $23,398,877
FBM Future Battery 6% 6% 8% -4% 0.055 $27,755,311
LPM Lithium Plus -3% 3% -10% -40% 0.18 $15,907,817
KOB Kobaresourceslimited 0% -4% -35% -21% 0.11 $14,345,833
EMC Everest Metals Corp -5% -11% 0% -12% 0.076 $13,142,649
LRD Lordresourceslimited 13% 4% -9% -73% 0.053 $1,745,210
IEC Intra Energy Corp 0% 0% -33% -60% 0.002 $3,381,563
REC Rechargemetals 0% -3% 11% -44% 0.07 $7,794,638
SLM Solismineralsltd -4% -4% -4% -21% 0.115 $9,418,650
AZS Azure Minerals 0% 1% -1% 1117% 3.59 $1,651,246,470
DYM Dynamicmetalslimited 0% 32% 28% 28% 0.205 $7,380,000
TOR Torque Met -9% -6% -27% 11% 0.15 $25,253,831
SBR Sabre Resources 0% -11% -19% -50% 0.017 $6,362,453
ICL Iceni Gold -6% 67% -25% -68% 0.03 $7,889,954
TMX Terrain Minerals 25% 25% 11% -17% 0.005 $5,726,683
MHC Manhattan Corp Ltd 0% 20% 0% -50% 0.003 $8,810,939
MHK Metalhawk. 6% 7% -15% -42% 0.072 $6,760,182
NKL Nickelxltd 0% -3% -8% -46% 0.036 $3,161,346
TMB Tambourahmetals -4% -11% 2% -23% 0.085 $7,381,691
ANX Anax Metals Ltd -5% 6% -17% -72% 0.019 $10,848,959
PMT Patriotbatterymetals 1% 9% 32% -47% 0.875 $498,013,872
BM8 Battery Age Minerals 0% -9% 3% -69% 0.15 $13,764,048
L1M Lightning Minerals 0% -3% -5% -56% 0.07 $2,955,754
ADG Adelong Gold Limited -11% -20% -20% -50% 0.004 $3,230,950
TOR Torque Met -9% -6% -27% 11% 0.15 $25,253,831
AL8 Alderan Resource Ltd 20% 20% 100% -14% 0.006 $5,534,307
OZM Ozaurum Resources -6% -4% -3% 34% 0.067 $11,271,250
FL1 First Lithium Ltd -4% 2% 0% 39% 0.25 $18,213,433
PLN Pioneer Lithium 0% 0% 0% 0% 0.155 $4,405,875
WYX Western Yilgarn NL -2% -28% -31% -51% 0.061 $3,855,935
RDN Raiden Resources Ltd -4% 0% 14% 426% 0.025 $69,071,213
PFE Panteraminerals 2% 15% 0% -50% 0.055 $13,512,006
GRE Greentechmetals -4% 20% 26% 74% 0.27 $23,542,393
OLY Olympio Metals Ltd 0% 3% 50% -36% 0.09 $5,723,955
SUM Summitminerals 0% 1% -1% -47% 0.069 $3,288,342
JBY James Bay Minerals -6% -3% 3% 0% 0.16 $5,515,650
SCN Scorpion Minerals 0% 67% 20% -56% 0.03 $12,283,686
JNO Juno 0% 6% -21% -9% 0.071 $12,918,113
CC9 Chariot Corporation -2% -4% -5% 0% 0.275 $22,900,180
OBM Ora Banda Mining Ltd 6% 8% 22% 150% 0.275 $443,953,115
RON Roninresourcesltd 0% -13% -17% -38% 0.1 $3,682,501
CXB0 ASRA MINERALS LTD. 0% 0% 0% -48% 0.00003 $0
ASR Asra Minerals Ltd 0% 0% 9% -45% 0.006 $9,918,974
PFE Panteraminerals 2% 15% 0% -50% 0.055 $13,512,006
TG6 Tgmetalslimited -8% -23% 5% 92% 0.23 $13,521,542
HAW Hawthorn Resources 0% -6% -10% -25% 0.075 $25,126,171
KM1 Kalimetalslimited 5% 10% 1% 0% 0.43 $31,300,259
AEV Avenira Limited 0% 0% -9% -17% 0.01 $21,925,716
DVP Develop Global Ltd 0% 19% 12% -24% 2.48 $601,780,881
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