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Investing.com -- UBS has upgraded its lithium price forecasts after a deep-dive analysis revealed broader and deeper supply disruptions in China could impact up to 15% of global lithium supply.
The bank raised its spodumene price forecasts by 9-32% and lithium chemical prices by 4-17% across 2025-2028 following mining suspensions in China, including CATL’s Jianxiawo mine idling and other potential compliance issues.
UBS analysts identified several key disruptions, including Zangge Mining’s suspension on July 14, CATL’s suspension on August 10, seven lepidolite mines in Yichun at risk after September 30, and Citic Guoan’s brine operation in Qinghai facing production limits.
The bank now expects a relatively strict execution of mining rights investigations by the Chinese government, with CATL’s operations potentially idled for about 12 months and other mines facing various disruptions.
Global electric vehicle sales growth remained robust at 26% year-over-year in June, led by China at 31% growth.
Chinese EV makers now control approximately 64% of the global market despite North American EV market contraction.
Battery energy stationary storage (BESS) demand also shows strength, with the global project pipeline now up 117% year-over-year, representing approximately 1.7TWh of capacity in the pipeline for 2025-2030.
UBS expects the lithium market to be almost in deficit in 2026 before some supply returns in 2027.
The bank’s price outlook remains above consensus for spodumene in the near term but below consensus for both spodumene and chemical prices in the long term.
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