Pilbara Minerals indicated on Thursday that it perceives signs of stabilization in the lithium market, alongside Australia’s leading producers who have faced a decline in earnings and are strategizing to navigate through the decelerating demand for the essential material used in electric vehicle batteries.
Over the past year, lithium prices have plummeted by approximately 70% due to a slowdown in electric vehicle sales growth. However, Pilbara Minerals CEO Dale Henderson expressed optimism regarding the market’s longer-term outlook, citing capacity expansions by chemicals manufacturers and global governmental support.
In the short term, there appears to be a leveling off of lithium ore spodumene prices, with a slight increase noted in China’s lithium carbonate prices. Henderson highlighted an uptick in customer inquiries over the past eight weeks, signaling a potential shift in market dynamics.
The closure of CATL’s high-cost Jianxiawo lepidolite operations was viewed as a positive development for the market by Henderson. Australian lithium stocks surged earlier in the week following speculation about this closure, indicating its potential impact on market dynamics.
Pilbara Minerals reported a significant 78% decline in first-half profits due to weak lithium prices and decided to withhold dividends to bolster capital for project investments.
Other major Australian producers, responsible for about half of the world’s sea-borne lithium supply, emphasized cost-cutting measures and indicated a review of new investment timelines based on market conditions.
Mineral Resources, a diversified miner, hinted at potential delays in the commencement of production from its Wodgina train 3 concentrator, originally scheduled for mid-year. They also suggested a possible postponement of the construction of a fourth train, initially targeted for 2026.
Battery minerals producer IGO reported a 26% decline in profits and hinted at adjustments in the timeline for the fourth ore processing plant at its Greenbushes mine, slated to commence commissioning in 2027.
IGO co-owns Greenbushes, the world’s largest lithium mine, with China’s Tianqi Lithium and Albemarle Corp.
