Pilbara Minerals share price hits record high following lithium auction

This lithium share is rising to a record high on Wednesday…

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The Pilbara Minerals Ltd (ASX: PLS) share price has climbed to a new record high on Wednesday after some good news offset the market selloff.

At the time of writing, the lithium miner's shares are up almost 3% to a new high of $5.03.

This compares very favourably to the ASX 200 index, which is down a disappointing 1.2% in early trade following weakness on Wall Street overnight.

Why is the Pilbara Minerals share price rising?

The Pilbara Minerals share price is rising today following the release of a positive update relating to the company's latest battery material exchange (BMX) auction.

After the market close on Tuesday, the company revealed the that its BMX auction had been another big success.

According to the release, Pilbara Minerals has commanded another increase in the price it commanded from the BMX auction.

After accepting bids of US$6,188 per dmt in July and US$6,350 per dmt in August, the company accepted the highest bid of US$6,988 per dmt in September.

This is for 5,000 dmt at a target grade of ~5.5% lithia and represents a decent 10% increase month on month. On a pro rata basis for lithia content (and adjusted to be inclusive of freight costs), this equates to a price of ~US$7,708 per dmt (SC6.0, CIF China basis).

This strong pricing appears to demonstrate that the insatiable demand for lithium is not cooling despite concerns about the potential for a global recession in the coming months.

Following today's gain, the Pilbara Minerals share price is now up an impressive 40% in 2022.

Motley Fool contributor James Mickleboro has positions in Allkem Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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