Today's AFR:
Lithium prices bounce in China: Morgan Stanley
Luke Housego
Lithium carbonate spot prices have climbed back to $US10,000 ($12,930) in China, according to research from Morgan Stanley.
But the improved market conditions are likely drive supply-side responses keep pressure on price growth, the analysis notes.
“Supply continues to tighten in China and spot prices continue in a strong upward trend, now back to $US10,000 per tonne and way above the marginal cost of production at $7000 per tonne,” the research says.
“We do not rule out lithium carbonate prices may increase further during months of tighter supply, particularly in a bullish environment for commodity prices.
“Yet, we still believe that at this level, halted capacity will come back online and expansion projects will be resumed.
“We think this should help bring more balance to the market and prevent prices from going to peak-of-cycle levels seen in 2017.”
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