Joe Lowry: Lithium's Time Has Come, Expect Tight Market for Rest of Decade

Joe Lowryyoutu.be

Last year saw lithium prices rally to all-time highs, with unprecedented demand expected in the coming years as the world continues to move toward green energy sources.

Speaking with the Investing News Network (INN), lithium expert Joe Lowry of Global Lithium shared his insights on the lithium sector, from supply and demand dynamics to high prices.

“The year 2022 will be the year of the most divergence from high to low-end pricing that we've ever had — by a wide margin,” Lowry told INN. “I expect the market to continue to be tight for the rest of the decade.”

For Lowry, current lithium prices, which increased over 400 percent in 2021 and are up more than 100 percent year-to-date, are too high and unhealthy for the sector.

“I don't think the industry is well served by US$80,000 a tonne pricing,” said Lowry, who is the host of the Global Lithium Podcast. “Largely it's the fault of the people that need the lithium the most because they weren't there to invest, to support small projects when it was needed.”

A key theme discussed at this year’s Fastmarkets Lithium Supply and Raw Materials conference was how to scale up supply to meet increasing demand, with producers calling for more cooperation in the supply chain.

“You can build a gigafactory in two years, but it takes up to 10 years or more to bring on a greenfield lithium project,” Lowry said. “You couple that with the fact that now demand is growing each year more than the whole market was in 2016 — that's a huge difference.”

Worries over excess lithium supply have hit the market in recent weeks on the back of a report released by Goldman Sachs (NYSE:GS) analysts, who are calling for a crash in prices by 2023. But for Lowry, the lithium market is in a real structural shortage that is going to last a few years.

“It will be internalized by just about everybody by 2023,” he said. “It's going to be an interesting few years. But I do think that the lithium situation will force adjustments by the (original equipment manufacturers).”

Lowry also shared his insight on Asia and the west, investing during a season of volatility and what he expects to see from now until 2025 in lithium. Listen to the interview above to learn more of his thoughts; you can also click here for INN's full playlist from the event on YouTube.

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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.