Lithium carbonate prices have surged to all time highs, with battery metals leading the charge among ASX 300 mining stocks this morning.
According to battery metals price monitors Benchmark Mineral Intelligence, lithium carbonate prices rose by 26.5% to RMB160,000/t, the equivalent of US$24,800/t in the fortnight to September 30.
That eclipses the high of US$24,750/t seen on March 30, 2018 and, according to BMI “marks a new era for the lithium industry”.
BMI is bullish about contract prices going forward as well, with the annual contracting period soon upon us and portions of the supply chain looking to move from quarterly to monthly contracts to capture more of the price upside currently on offer.
“Looking forward, record high spot transactions are likely to incentivise a strong upward revision of contract prices in Q4 as new deals and pricing breaks are negotiated for the start of 2022,” BMI analysts said.
“Historically, supply contracts are negotiated in Q4 and can be influenced by sentiment in the spot market. It is this revision that sparked the surge in lithium chemicals pricing in 2015, indicating that the start of 2022 could see further momentum in price rises.”
“Market contacts have also reported to Benchmark that they expect a larger proportion of the supply chain may look to implement monthly, rather than quarterly, price breaks, fueling the surge further if typically discounted contracted volumes become more regularly based on escalating spot deals.”
