Lithium news keeps coming

Lithium stocks mania to extend into 2024 as EV demand soars

Tom RichardsonJournalist and commentator

Sep 1, 2023 – 2.40pm

Australia’s lithium boom remains one of the sharemarket’s hottest sectors with the commodity expected to remain in a supply deficit out to 2030 as demand for the battery ingredient from electric vehicle makers continues to soar globally.

Just this week, shares of lithium miner IGO jumped more than 5 per cent after it flagged a $1.1 billion windfall for investors from its joint venture stake in Western Australia’s hard rock lithium Greenbushes mine.

Surging demand for lithium, the key ingredient used in electric vehicle batteries, has spilled over into the ASX. New York Times

Soaring demand for lithium has driven IGO’s shares 249 per cent higher over the past five years to a $10.5 billion valuation. Rival Pilbara Minerals has jumped 549 per cent over the period to $14.5 billion as its profits from the Pilgangoora Mine hit $2.4 billion in the 2023 financial year.

The lithium rush has spilled into the sharemarket with dozens of ASX-listed junior explorers in Australia, Africa, South and North America all looking to exploit the supply shortages and emulate the blockbuster success of existing producers.

“We prefer producers generating cash with significant growth options in the portfolio like IGO Ltd and Pilbara [Minerals],” UBS resources analyst Lachlan Shaw said.