Eye on Lithium: Lithium-ion battery pack prices are up for the first time
All your lithium news, Wednesday December 7.
There’s a potential slowdown in the lithium market, but did you hear that lithium-ion battery pack prices are up for the first time in 12 years?
BloombergNEF (BNEF) notes that volume-weighted average prices for lithium-ion battery packs across all sectors have increased by 7% from last year to US$151 ($225.6) per kilowatt hour (kWh) in 2022.
This price increase – the first since BNEF started tracking the market – is fuelled by rising raw material and battery component prices that were further compounded by soaring inflation.
BNEF noted this upward cost pressure outpaced the higher adoption of lower cost chemistries like lithium iron phosphate (LFP), with prices likely to stay at similarly elevated levels next year.
“Raw material and component price increases have been the biggest contributors to the higher cell prices observed in 2022,” BNEF energy storage associate Evelina Stoikou noted.
“Amidst these price increases for battery metals, large battery manufacturers and automakers have turned to more aggressive strategies to hedge against volatility, including direct investments in mining and refining projects.”
Contrary to reports about a market slowdown, BNEF only expects battery prices to start dropping in 2024 – two years later than previously expected – when lithium prices are expected to ease as more extraction and refining capacity comes online.
“Lithium prices remain high due to persistent supply chain constraints and the slow ramp up in new production capacity,” BNEF head of metals and mining Kwasi Ampofo said.
“Additional lithium supply could ease the pressure on prices in 2024, while geo-politics and trade tension remain the biggest uncertainties for other key battery metal prices in the short-term. Resolving these tensions could help calm prices in 2023 and beyond.”
Lithium companies continued to be pummelled, with just 25 companies up today while 52 slipped into the red.
Proving that there’s still plenty of pent up demand for lithium stocks, shares in ASX newcomer Patriot Battery Metals more than doubled after listing today.
The Ken Brinsden-chaired dual-listing raised $4.2m at an issue price of $0.60 per CDI. Shares in the company were last about $1.31.
Brinsden cut his teeth turning Pilbara Minerals from just another penny stock into a $15bn lithium major and recently compared Patriot’s Corvette discovery with the Pilgangoora Lithium-Tantalum project which was at the centre of PLS’ growth.
Corvette is a 50km trend littered with spodumene outcrop that Patriot hopes could be the next major North American lithium discovery.
Red Mountain has moved to acquire the Lithic and Mustang lithium projects in Nevada – the dominant clay-hosted lithium region in the US – from Lithic Lithium, a subsidiary of Chariot Corporation.
The projects are located in an emerging district hosting recently discovered lithium deposits and aggressive lithium exploration as well as being in close proximity to potential offtake partners.
Efforts by the US to secure domestic supplies of battery and critical minerals – such as the Defence Production Act – are also expected to benefit the company.
Red Mountain plans to carry out additional sampling, geological mapping and reconnaissance of Lithic and additional geological mapping and surface sampling at Mustang.
It also intends to conduct a line of shallow trenches, over a 2000m northeast trending line through the centre of the Lithic claim bloc, which will be used to identify suitable exploration targets for reverse circulation drilling.
Likewise, the work at Mustang will inform the planned 10-hole RC drill program which will be used to vector further drilling.
Meanwhile, Burley has appointed Canadian geological consulting group Dahrouge to manage exploration development plans and approvals for its Chubb lithium project in Quebec, Canada.
This is aimed at expediting the advancement of the proposed exploration program and geological interpretation of previous drill data and metallurgical analyses from Chubb.
Separately, the company has appointed SnowdenOptiro to manage the maiden mineral resource estimate.
SnowdenOptiro has already completed initial stage geostatistical data review and has started the wire-framing of historical and current pegmatite intercepts.