TORONTO - The Oregon Group, an investment research firm, has released a report predicting a significant, sustained increase in lithium demand over the next 20 years, driven largely by the electric vehicle (EV) and battery sectors. This forecast comes amid a backdrop of price corrections in the lithium market throughout 2023, which has seen a slowdown in new lithium project developments and supply expansions.
The report highlights that the dominant demand for lithium stems from its use in electric batteries and vehicles, a sector that is not only the largest but also the fastest-growing for the mineral. This situation is described as unusual, even within bull markets. The demand growth is set against challenges such as price volatility, which has been exacerbated by geopolitical tensions, environmental concerns from local communities, and government permitting issues.
Despite these challenges, established lithium producers like Albemarle (NYSE:ALB) and Pilbara Minerals (ASX: PLS), as well as funds like Horizons Global Lithium Producers Index ETF (TSE:HLIT), are expected to benefit from a higher-priced market. Additionally, emerging players in Africa, such as Premier African Minerals (AIM:PREM) and Li3 Lithium Corp (TSX.V:LiLi), are also well-positioned to capitalize on this growth.
The report also references a prediction by Goldman Sachs from 2015, which has come to fruition, with lithium becoming the "new gasoline" for 15.5% of new cars sold globally in the first half of 2023. This is attributed to lithium's superior energy density, lighter weight, longer charge retention, and lack of charge memory. Despite research into next-generation battery technologies, lithium-ion remains the dominant technology and is expected to continue its reign for many years.
The Oregon Group, founded by Anthony Milewski and Justin Cochrane, focuses on investment trends related to commodities and energy transition. The new report, titled "Inside the Accelerating Global Race for Lithium," aims to provide insights into key trends and players in the lithium market.
This article is based on a press release statement from The Oregon Group.
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