It certainly has been a tough 12 months for ASX lithium stocks.
During this time, the likes of Arcadium Lithium (ASX: LTM), Core Lithium Ltd (ASX: CXO), IGO Ltd (ASX: IGO), Liontown Resources Ltd (ASX: LTR), and Pilbara Minerals Ltd (ASX: PLS), Sayona Mining Ltd (ASX: SYA) have all recorded sizeable declines while the market as a whole has charged higher.
For example, Core Lithium and Sayona Mining shares are both down around 80% since this time last year, whereas IGO and Liontown shares have lost approximately half of their value over the same period.
Investors have been hitting the sell button in response to falling lithium prices. This has been driven by increasing supply of the white metal, particularly in the China market.
But where next for lithium prices? Will they recover to previous levels in the near future? Let's take a look and see what analysts at Goldman Sachs are forecasting for three widely used lithium types – lithium carbonate, lithium spodumene, and lithium hydroxide.
Lithium prices
Firstly, let's have a little reminder of what lithium prices were commanding on average in 2023.
- Lithium carbonate – China: US$32,694 per tonne
- Lithium hydroxide – China: US$32,452 per tonne
- Spodumene 6%: US$3,712 per tonne
Now we will take a quick look at the current spot prices of these metals compared to what they were commanding back in January. The current prices are as follows:
- Lithium carbonate – China: US$13,012 per tonne (January: US$11,867)
- Lithium hydroxide – China: US$9,591 per tonne (January: US$9,899)
- Spodumene 6%: US$1,210 per tonne (January: US$1,000)
Forecasts through to 2027
Unfortunately for investors of ASX lithium stocks, Goldman Sachs is not expecting a big improvement in lithium prices in the coming years.
Lithium carbonate – China:
For lithium carbonate, the broker is forecasting the following through to 2027:
- 2024: US$11.106 per tonne
- 2025: US$11,000 per tonne
- 2026: US$13,323 per tonne
- 2027: US$15,646 per tonne
- Long-term: US$15,500 per tonne
Lithium hydroxide – China:
It will be a similar story for lithium hydroxide according to the broker. It is forecasting the following:
- 2024: US$9,849 per tonne
- 2025: US$12,500 per tonne
- 2026: US$14,323 per tonne
- 2027: US$16,146 per tonne
- Long-term: US$15,500 per tonne
Spodumene 6%:
Finally, the broker is expecting spodumene prices to remain in and around current levels for the foreseeable future. It has pencilled in the following for the coming years:
- 2024: US$928 per tonne
- 2025: US$800 per tonne
- 2026: US$978 per tonne
- 2027: US$1,155 per tonne
- Long-term: US$1,150 per tonne
