Spodumene bids hit record US$5,955 at Pilbara Minerals' fifth lithium auction
There's still fuel in the tank for lithium prices after a new record bid at Pilbara's spot auction
Source: iStock
Mentioned
KEY POINTS
- The winning bid of US$5,955 tops last month's record of US$5,560
- The result might come as a surprise after Chinese lithium prices topped out in early April
- Fastmarket observes a pick up in Chinese lithium sentiment as lockdowns are lifted
Pilbara Minerals (ASX: PLS) has set another record at its lithium auction on Tuesday night, suggesting that lithium demand remains strong, even at elevated prices.
The winning bid was US$5,955 per dry metric tonne (dmt) for a cargo of 5,000 dmt of spodumene concentrate.
Previous spodumene auctions recorded prices (dmt, free-on-board basis) of:
April 27 2022: US$5,650
October 2021: US$2,350
September 2021: US$2,240
July, 2021: US$1,250
Demand is still there
The highest bid of US$5,955 was 5.4% higher than Pilbara Minerals' April auction, even though, even though Chinese lithium prices have experienced a gradual decline since early April.
Source: TradingEconomics
Sentiment is picking up
Sentiment within China's domestic lithium market is looking more bullish according to commodity reporting agency, Fastmarkets.
Previous industry commentary suggested that lithium buyers and sellers were in somewhat of a deadlock, with sellers keeping their offers firm in expectation of higher prices and buyers expressing less interest in anticipation of lower prices due to lockdowns.
More recent commentary from Fastmarkets includes:
International consumer: “Demand for lithium hydroxide remains strong in the seaborne market, while spot supply is tight. Lithium consumers in Japan and South Korea are sending many inquiries to Chinese sellers.”
Chinese producer: “Chinese sellers are not lowering their offers for lithium hydroxide amid expectations of a price rise in the near term, when the Chinese market recovers from the most recent outbreaks of Covid-19.”
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Pilbara Minerals 12-month price chart
