Lithium prices vary substantially depending on the purity of the material supplied - battery grade is at the higher end and this is where the major demand growth is coming from. Of course commodity prices are affected by supply and demand and if demand grows rapidly, prices will rise unless supply rises correspondingly. Since thtere are only a couple of major producers the potential is there for demand to rapidly outpace supply (although these other producers are also ramping up production).
Demand is diltfficult to predict however you could probably double current demand from consumer electronics alone in the next few years. Cars are a whole new kettle of fish as a single car may require the equivalent of several thousand camcorder batteries. Possibly the largest source of demand could be from energy storage from renewable energy sources and load management at power generators. Currently lithium carbonate accounts for only a small component of the cost of a battery so would expect it to be used in far greater quantities and many other applications if other production costs can be brought down.
ORE Price at posting:
30.0¢ Sentiment: Buy Disclosure: Held
