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Albemarle (NYSE:ALB), the world’s biggest lithium producer, reduced its 2030 demand forecast for the crucial battery ingredient as the shift to electric vehicles in the U.S. and Europe is moving slower than expected.
Albemarle (ALB) forecast 3.3 million tonnes of lithium carbon equivalent to be needed globally by 2030, a 10% cut from its previous forecast of 3.7 million tonnes, according to a Financial Times report on Friday, which cited an interview with Eric Norris, Albemarle’s president of lithium.
Norris told the FT the lithium producer is cutting its forecast as car manufacturers are delaying the launch of electric vehicle models in Western markets.
“Some models have been delayed, largely out of North America, which is pushing out the length of time of penetration [of EVs] in the US,” said Norris, adding that “potentially in parts of Europe” the shift is also expected to take longer.
Norris’ comments come as lithium prices that have plunged 80% since the start of last year are “unsustainable” and must rise in order to trigger the supply investments needed to meet long-term demand growth, Albemarle (ALB) CEO Kent Masters said Thursday.
“We think prices today are unsustainable,” Masters said on the company’s post-earnings conference call, adding that lithium projects in the West are especially at risk at current prices. “Incentivizing producers to meet this demand requires long-term pricing at or above investment economics.”