Livent (LTHM)

Jul 27, 2022Trade Ideas

Lithium prices are expected to push even higher.

For one, “To keep up with demand, every existing producer supplying the market today must double every two to three years for the next decade,” Eric Norris, President of Albemarle said. “No producer has been able to do that reliably to date.”

Two, SQM Commercial Vice President, Lithium, says “The market needs about 200 to 300,000 tonnes of lithium every year (to meet demand) and that means that you need roughly 8 to 10 new projects coming on stream every year.”

Three, major automakers are working with lithium companies to secure supply. Livent (LTHM), for example, just announced a sourcing agreement with General Motors.

According to a recent LTHM press release, “Lithium hydroxide is crucial to GM’s plans to make higher performance, higher mileage EVs. The lithium hydroxide from Livent will be used in GM’s Ultium battery cathodes, which will power electric vehicles such as the recently revealed Chevrolet Blazer EV, Chevrolet Silverado EV, GMC HUMMER EV and Cadillac LYRIQ.”

That being said, keep an eye on the LTHM stock.

From a current price of $23.06, we’d like to see it refill its bearish gap around $27 initially.

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