ASX lithium shares are having a tough run on Thursday amid concerns the global supply/demand dynamic is shifting.
At the time of writing, the market's biggest lithium company, Pilbara Minerals Ltd (ASX: PLS), is down 6.9% to $2.79.
The Mineral Resources Ltd (ASX: MIN) share price is $45.05, down 0.6%.
Liontown Resources Ltd (ASX: LTR) shares are 67 cents apiece, down 5%.
Elevra Lithium Ltd (ASX: ELV) shares are down 8.3% to $3.42.
The Core Lithium Ltd (ASX: CXO) share price is down 3% to 23 cents.
Some ASX lithium shares are holding up well.
Wildcat Resources Ltd (ASX: WC8) shares are up 1.1% to 23 cents.
The IGO Ltd (ASX: IGO) share price is down 0.1% to $5.20.
Today's share price declines come amid a near-20% fall in the lithium carbonate price over the past month.
Image source: Getty Images
Share price trajectory
As the following price growth chart shows, these seven shares have followed a similar and volatile path over 12 months.
The common denominator with all of them is the influence of commodity prices.
As we've reported, lithium was the best-performing commodity of FY26 for growth.
Lithium spodumene rose 278% and carbonate rose 160% over that 12 month period.
That followed a significant two-year slump between mid-2023 to 2025.
Skyrocketing prices in FY26 were the result of rebalanced supply and demand.
But of late, that dynamic has shifted, and lithium commodity prices have tumbled since mid-year.
This is reflected in the share price movements below.
Six of the seven stocks have followed that same downward trajectory.
Only PLS shares have gone the other way.
Supply/demand balance shifts
Analysts at Trading Economics say demand is softening right now, just as supply is increasing to become "ample".
One factor raising supply is miners re-starting operations after a period of care and maintenance.
That's the case with Mineral Resources, which has restarted Bald Hill, and Core Lithium, which has restarted Finniss.
Then there are demand factors at play, as the analysts explained:
The EU is set to cap imports of Chinese hybrid electric vehicles at 350,000 units annually starting next year.
The European Commission noted that this is expected to halve China's market share across the bloc, limiting orders from battery manufacturers in the region after recent data showed higher-than-expected lithium inventories.
Lithium price set to soar 63%
Despite all this, the Federal Resources Department expects lithium prices to soar and peak in FY27.
According to the September Resources and Energy Quarterly, the lithium spodumene price averaged US$1,532 per tonne in FY26.
For FY27, the department expects a steep increase to US$2,499 per tonne.
After that, lithium prices are expected to fall back to an average US$1,684 per tonne by FY31.
