There is another side to this problem. Mineral Resources has put a hold on Lithium production for the near future. I'm reading that quite a few lithium producers are going into Care and Maintenance to conserve company capital. We on the other hand are not. Can this be to our advantage as increased lithium is taken away from the market? Is it possible that we could be looking at a strong turnaround if there is a lithium shortage? The one critical issue in my mind is WHY were lithium prices valued so high a year ago?
What was different then and what has changed to cause such a large drop? Please for the love of God, don't say China. China is not the only player in the lithium market. There is something else at play. I'm guessing futures markets are the real culprit pushing prices to new lows. CALL options, in fact I believe the entire lithium industry has simply been played by hedge markets around the world. There is no reason for lithium to drop so hard in such a brief time unless the industry has been played by financial institutions worldwide. We have seen this be in past years e.g.
Oil: The oil market has seen substantial shorting, especially during periods of economic downturns and geopolitical tensions. For instance, the 2008 financial crisis and the 2020 COVID-19 pandemic led to significant short positions as demand plummeted.
Gold: While gold is often seen as a safe haven, it has also been subject to shorting, particularly when the US dollar strengthens or when interest rates rise.
Natural Gas: This market has been highly volatile, with prices often subject to shorting due to fluctuations in supply and demand, weather conditions, and geopolitical factors.
Agricultural Commodities: Crops like corn, wheat, and soybeans have been shorted due to factors such as changes in weather patterns, trade policies, and global supply chain disruptions.
Base Metals: Metals like copper, aluminum, and nickel have also seen shorting, particularly during periods of economic uncertainty or when there are concerns about industrial demand.
SYA Price at posting:
2.5¢ Sentiment: Buy Disclosure: Held
(20min delay)