General Discussion, page-146

Extract taken from the Economist
https://www.economist.com/the-economist-explains/2022/06/09/will-there-soon-be-a-surplus-of-lithium?utm_content=article-link-6&etear=nl_today_6&utm_campaign=a.the-economist-today&utm_medium=email.internal-newsletter.np&utm_source=salesforce-marketing-cloud&utm_term=6/9/2022&utm_id=1196464

Joe Lowry, a lithium-industry expert, reckons lepidolite cannot supply as much growth as the bank expects because it is hard to extract lithium from it. Benchmark Minerals, a research firm, estimates that Chinese lepidolite processing has a waste-to-ore ratio of 20-to-one. Setting up new mines can take between five and ten years. “Lithium projects often disappoint in terms of the timeline,” says Benchmark’s Henry Sanderson. All the while, demand for electric cars and batteries will continue to grow.

That means a surplus is unlikely, at least in the immediate future. “Supply for 2022-24 was determined by events five to ten years ago,” says John Startin of Evercore, a bank. Benchmark thinks the supply deficit will grow this year; it does not foresee it coming into balance until 2026, and even then, only briefly. The spot price, Mr Sanderson reckons, may decline, but the overall lithium price—largely determined by fixed contracts—will remain stable. For carmakers and other buyers, that is bad news; for miners, it is encouraging.