When one of the biggest operators in an industry speaks, it's usually worth listening. Investors of ASX lithium shares had the chance to get the latest pulse reading from US-based Albemarle Corporation (NYSE: ALB) last night, and the outlook is rather rosy.
Today, the S&P/ASX 200 Index (ASX: XJO) is lingering 0.11% lower following the release of surprisingly high inflation data. Despite this, several Aussie companies involved in producing the electrifying material are in the green.
Image source: Getty Images
Driving a positive outlook for lithium
For some background, Albemarle is one of the largest suppliers of battery-grade lithium in the world. The company not only produces lithium but also processes it.
In the September 2022 ending quarter, Albermarle achieved US$1.5 billion in net lithium sales. In comparison, Pilbara Minerals Ltd (ASX: PLS) recorded $1.19 billion in revenue across the entire 2022 financial year.
Last night, Albermarle provided updated estimates for the future of lithium in its 2023 strategic update. The most eye-catching metric was a 15% increase in the company's lithium demand forecast for 2030, primarily due to higher expected electric vehicle (EV) adoption.
As such, management is now forecasting a total of 3.7 million metric tonnes worth of lithium demand in 2030 — giving ASX lithium shares something to cheer about. This is based on the assumption that annual EV production will reach 46.9 million by that point in time, equating to a 48% market penetration of light-duty vehicles.
Albemarle energy storage president Eric Norris described the catalyst for increased demand, stating:
We expect to continue to see increased EV adoption with charging speed and range improvements; more access to charging infrastructure; and changing consumer preferences. In response, auto OEMs are setting ambitious electrification goals and making large investments in EV production.
How are ASX lithium shares are responding?
The peachy outlook painted by Albermarle's management could be supporting the prices of Aussie lithium companies today. Greater demand for lithium could mean higher prices for longer, promoting strong ASX lithium share prices today, including:
- Vulcan Energy Resources Ltd (ASX: VUL) up 0.73%
- Galan Lithium Ltd (ASX: GLN) up 0.81%
- Neometals Ltd (ASX: NMT) up 3.07%
- Sayona Mining Ltd (ASX: SYA) up 2.78%
At the larger end of town, Mineral Resources Ltd (ASX: MIN) is struggling on Wednesday despite releasing its quarterly report. Shares in the lithium and iron ore miner are down 1.42% this afternoon with iron ore shipments weighing on shareholder sentiment.
