The price of lithium carbonate continues to be top-heavy in August, having curled upward in the past two weeks of trade.
From 17 August to date, the price of the key battery metal has caught a bid and gained 1.45% to A$102,690 per tonne.
Prior to this, lithium carbonate had remained steady since May, after a small dip in prices that saw the metal trade sideways, as seen below.
This market behaviour has been nothing but positive for the Lake Resources N.L (ASX: LKE) share price this past month, as seen in the above chart.
The little-known ASX lithium share has gained 75% in the past month of trade after a choppy period leading into the new financial year.
During August alone, it has traded in a range of 83 cents to $1.59, currently resting at $1.225 apiece.
Image source: Getty Images
Pricing looks positive for the industry
The earnings result this week from fellow lithium player Pilbara Minerals Ltd (ASX: PLS) also suggests that demand for lithium remains high.
Pilbara posted a 577% jump in annual revenue to $1.2 billion, citing demand for both its lithium and spodumene concentrate as reasons behind the increase.
Certainly, Pilbara Minerals is positioned further along the value chain than Lake Resources in that it already produces and sells lithium material.
However, heightened demand, based on several macroeconomic factors, could keep lithium prices top-heavy in the years to come.
For instance, "soaring demand drove expectations of extended supply deficits" in the 12 months to August, resulting in a 400% gain in prices, Trading Economics says:
On top of that, mid-year maintenance for producers drove carbonate output to contract 4% on the month to 30,320 tonnes during July.
In the US, demand for new energy vehicles is set to increase as the newly passed "Inflation Reduction Act" extends tax breaks for new electric vehicle purchases.
As such, ASX lithium shares like Lake Resources have strengthened and reclaimed a good chunk of losses suffered earlier in the year.
The Lake Resources share price is still up more than 105% for the past 12 months, of 21% this year to date.
