The Pilbara Minerals Ltd (ASX: PLS) share price is plummeting today.
The lithium explorer's shares have fallen 17.3% at the time of writing. For perspective, the S&P/ASX 200 Materials Index (ASX: XMJ) is down 0.98% so far.
Let's take a look at what could be impacting the Pilbara Minerals share price.
Lithium price outlook
Pilbara Minerals shares are falling, but they are not the only lithium share to plunge. The Core Lithium Ltd (ASX: CXO) share price is down nearly 12% today, Liontown Resources Ltd (ASX: LTR) is 16% lower, and Allkem Ltd (ASX: AKE) is sliding 12%.
Investors could be selling down lithium shares after Goldman Sachs put out a note warning of a "sharp correction" in lithium prices in the next two years.
Goldman has predicted the lithium price could fall from US$60,350 per tonne to around US$54,000 per tonne in 2022. But, by 2023, Goldman estimates lithium could fall to US$16,372 per tonne.
In a recent note cited by Bloomberg, Goldman analysts Nicholas Snowdon and Aditi Rai predicted the "battery metals bull market" is over". The analysts said:
Investors are fully aware that battery metals will play a crucial role in the 21st century global economy.
Yet despite this exponential demand profile, we see the battery metals bull market as over for now.
Goldman is also predicting the price of nickel and cobalt to fall in 2022 and 2023.
Meanwhile, following the Goldman report, Credit Suisse has downgraded Pilbara Minerals from "outperform" to "neutral", The Australian reported. The broker has placed a price target of $3 on the company's share price.
Pilbara is developing the Pilgangoora Lithium Tantalum Project in Western Australia.
In overseas markets, the Lithium Americas Corp (NYSE: LAC) share price tanked nearly 13% on the New York Stock Exchange on Tuesday. However, in after-hours trading in the US, it is recovering slightly, up 1.83%.
Share price snapshot
The Pilbara Minerals share price has soared 104% in the past year but has dropped 21% year to date.
For perspective, the S&P/ASX 200 Materials Index has climbed nearly 4% over the past 12 months and more than 6% so far this year.
Pilbara Minerals has a market capitalisation of about $7.5 billion.
