UBS is the latest broker to slash its lithium forecasts, warning that more projects need to close or pause production to end the collapse in prices.
The lithium sector is facing a wave of mine closures as prices for the battery material continue to decline despite some companies already delaying future projects.
“While we don’t observe any large-scale curtailments yet, it is clear that the stress of low prices needs to drive production curtailment and delay/deferral of growth projects,” said UBS analyst Lachlan Shaw.“Core Lithium’s Finniss care and maintenance was tip of the iceberg and will likely see other shuts if spodumene prices persist around spot of $US770 a tonne for the next year to year and a half as we now forecast.
However, Morgan Stanley suggested that physical lithium markets have started responding to lower prices, with China’s carbonate production down 10 per cent since the end of June.
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