Wesfarmers had a strategy day briefing a couple of days ago including an update on their Mt Holland project (still targeting nameplate. Yet to reach this target over a monthly period). As part of the pack they also put out this Lithium market update repeated below. The CY30 estimate is lower than some others circulating however what is IMO critical is the dot graph below. Its not what's there but what's missing and that's a lot of projects under development.
With the lead times on new projects, supply growth across 2025 and 2026 will come from in production mines, potentially C&M mines restarting and under development mines completing their development and successfully commissioning their plants. The lead times on DMS only and Flotation builds mean even if a new project were to FID tomorrow, anything more than token output in 2026 is unlikely.
The number of development projects has crashed and is now down at two within the dot graph they presented and those projects are at the medium and small end of the size spectrum. This should lead to less supply growth than has occurred over the recent past. If demand growth continues and supply growth slows down, this creates the situation for a rapid improvement in the supply/demand balance and consequently in lithium prices. Hopefully for LTR and others I'm right on this view because its not yet being reflected in spot prices.
LTR Price at posting:
63.5¢ Sentiment: None Disclosure: Not Held
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