Global cathode and precursor short-term outlook July 2024

Global EV sales climbed to 1.5 million units in June. Competition in China sees OEMs offering steep discounts. China’s plug-in EV sales grew 30% year-on-year and now account for 47% of the market. European sales fell 3% from July last year, and North America grew 1%. Raw material prices continue to fall as oversupply continues. Despite some curtailment in supply, there seems to be little positive sentiment in the market. Therefore, we once again revise short-term price forecasts lower for lithium and cobalt chemicals. As a result, cathode and precursor prices were lower in July. Our outlook for the short-term would do little to inspire would-be investors of operators. Cathode prices are expected to improve by only 5% on average between July and Q3 2026. Cathode production continues to decline pushing utilisation rates even lower. In efforts to kick-start growth, many automotive OEMs and cell producers are considering a switch to LFP.