Chilean state copper commission Cochilco says lithium demand will continue to grow this and next year, with prices maintaining the recovery path.
It forecasts demand of 1.3 million tonnes of lithium carbonate equivalent (LCE) in 2025, which would be a 22% increase compared to 2024. Volumes will then grow again by 16% to 1.5m t of LCE in 2026. EV batteries will account for 65% of that demand this year and 66% next year, Kallanish understands.
However, the market is projected to remain in surplus, with 103,000 t and 60,000 t of LCE estimated in 2025 and 2026, respectively, as Cochilco assumes mine supply growth of 17% and 12%.
Yet, the policy-led closure of several mines in China is providing some upside to lithium prices. The cif Asia lithium carbonate price reached $10,000/t at the end of August, while lithium hydroxide was at $8,600/t, showing a recovery from June lows of above $8,000/t.
For next year, the projection is for carbonate prices to hit an average of $10,327/t and lithium hydroxide prices an average of $10,920/t, both cif Asia.
“Supply-related factors will predominate over value in the short and medium term, as demand is growing more predictably,” the agency says.
Chile was the world’s second-largest lithium producer last year with an output of 49,000 t, following Australia with 88,000 t, according to the US Geological Survey.
Source:Kallanish
