By Ramón Roca
In New York, there is the fundGlobal X Lithium & Battery Tech, which collects the price of the 27 most representative companies in the sector. Among them are companies such asFMC Corp, the Chilean Chemical and Mining Society or battery manufacturers likeSamsung, Panasonic and Tesla.
This fund has appreciated 65% in the last 18 months, according to data from Bloomberg.
The main cause of this behavior is the ‘boom’ that the electric vehicle industry is experiencing. Five years ago, very few manufacturers were dedicated to selling this type of car, but almost all of them are already working with a model.
Even brands such as Volvo have already said that from 2019 all their sales will be electric and hybrid cars. In 2016 alone, two million electric vehicles were sold worldwide and the estimate is that it will increase in the coming years.
This boom has made white oil a quasi-precious mineral, highly valued in the market. Experts point out that there are not enough amounts of lithium in the world to be able to withstand a demand of these characteristics. Above all, the extraction industry does not provide as much supply.
Producing countries like Argentina, Australia or Chile receive large orders of lithium from all over the planet one month after another.
That strong demand for lithium has made him an absolute champion of the mining industry. The comparison with other minerals is abysmal taking into account the reference price in international markets.
The price of lithium has skyrocketed 335% since 2004 and it seems to find no ceiling. That's one of the reasons why lithium ion batteries don't drop as much in price as they should have.
It is expected to do so in the coming years, when the price of the mineral begins to stabilize and battery production is much higher.
In short, white oil is fashionable and will be in the coming decades.
The Energy Newspaper