Commodities, Finance, Lithium, News

Pilbara Minerals nabs nearly $US6000/t at lithium auction

Pilbara Minerals

Pilbara Minerals has rewritten its own history book, fetching another record result from its Battery Material Exchange (BMX) auction.

The lithium miner attracted a highest bid of $US5955 ($8380) per dry metric tonne (dmt) from its fifth BMX auction for a 5000dmt cargo of its 5.5 per cent spodumene concentrate. This trumped the previous record of $US5650/dmt achieved at its auction on April 27.

Pilbara Minerals’ first three BMX auctions nabbed prices of $US1250/dmt, $US2240/dmt and $US2350/dmt for 10,000dmt, 8000dmt and 10,000dmt cargoes, respectively.

The record result reflects the current situation in the lithium market, where demand for the commodity is well and truly exceeding supply.

According to Trading Economics, lithium carbonate in China was trading at 457,000 yuan ($96,640) per tonne on May 25. While this is a 3.6 per cent decrease on the month, it is still a 414 per cent jump from a year before.

Fitch Solutions’ senior commodities analyst Sabrin Chowdhury said a similar theme in the lithium market could be expected in the near-term.

“The demand outlook for lithium is very strong going forward and the supply of lithium is still quite tight,” Chowdhury told Australian Resources & Investment.

“Many miners are investing in lithium projects and there are new players emerging in the lithium market, but it will take quite some time for supply to match up with demand. So lithium prices will continue to remain elevated for a time to come.

“We won’t see the huge spike that we saw in the last 2–3 years in the lithium market again. (This is) because there will be a better balance of supply and demand going forward. But prices will not fall back to pre-2020 levels at least.”

Pilbara Minerals shipped 58,383dmt of spodumene concentrate in the March quarter of 2022, a drop from the 78,679dmt in shipments achieved in the December quarter of 2021.

In late March, the company was affected by a port delay in loading a cargo of approximately 20,000dmt at Port Hedland. This departed the dock on April 7.

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