Lithium is showing signs of life again after a brutal downturn, with prices surging to their highest level this year on the back of supply cuts in China.
Benchmark spodumene concentrate has climbed from about US$575 a tonne in June to US$970, according to Shanghai Metals Market. The rebound follows Beijing’s crackdown on illegal mining and export restrictions, along with the closure of CATL’s giant Jianxiawo lepidolite mine, which accounts for as much as 6% of global refined supply.
The supply shock has lit up ASX-listed producers. Pilbara Minerals jumped 19.7% last week, Liontown Resources rose 18.3%, and Mineral Resources and IGO also rallied. Smaller players followed suit, with Core Lithium up 15% and Galan Lithium advancing 10.7%.
Lithium prices had tumbled since late 2022 as supply ramped up faster than electric vehicle demand, forcing some juniors to pivot into other commodities. Now, analysts say Beijing’s intervention may mark the end of the bear market.
“China’s efforts to curb over-capacity could signal the worst is behind us,” said Commonwealth Bank strategist Vivek Dhar. Cannacord Genuity’s Reg Spencer added that EV sales in China and Europe are outpacing expectations, underscoring resilient demand.
Investors are also rewarding companies pushing ahead with projects. Core Lithium has unveiled plans to restart its Finniss project in the Northern Territory as an underground mine, with shares more than doubling since April. Anson Resources has surged nearly 200% in five weeks after tying up with South Korea’s POSCO on a Utah brine project. Galan Lithium has also secured fresh funding to bring its Hombre Muerto West project in Argentina into production next year.
Beyond EVs, the rapid build-out of energy storage systems is seen as another driver of long-term demand. Lithium’s properties make it a standout for grid-scale storage and renewable integration.
After a bruising two years, lithium may be heading for a steadier recovery — and those who stayed the course could be poised to benefit.