Goldman says the bear market for battery metal prices is far from over
The Albermarle Corp. lithium processing facility in Antofagasta, Chile, on Saturday, March 2, 2024.
Bloomberg | Bloomberg | Getty Images
Goldman Sachs finds it is too early to call an end to a battery raw materials price plunge, warning that significant supply pipelines and Western electric vehicle headwinds could keep prices lower for longer.
The forecast, which is part of a research note published on Tuesday, follows a sharp downturn in the price for some of the most sought-after energy transition metals. The end-use of materials such as nickel, copper, lithium and cobalt are wide-ranging and include electric vehicles, wind turbines and solar panels.
Goldman Sachs said the outlook appeared bearish for nickel, lithium and cobalt.
“Despite the significant downside in battery metals prices, with nickel, lithium and cobalt prices down 60%, 80% and 65% from cycle peak, respectively, we believe it is too early to call a decisive end to these respective bear markets,” analysts led by Nicholas Snowdon wrote in a note to clients.
“Margin pressures have generated a meaningful degree of supply rationing effects over the past quarter,” the U.S. investment bank said, citing incremental supply cuts in lithium and nickel.
Together with Western EV-related demand downgrades, the bank said that “significant” supply pipelines mean that the projected 2024 surpluses for lithium and nickel “remain sizeable.”
On a 12-month basis, analysts at Goldman said the Wall Street bank is targeting a 12%, 15% and 25% downside in cobalt, nickel and lithium carbonate, respectively.
It means that Goldman expects cobalt prices to trade at $26,000 per metric ton (down from a previous forecast of $28,000) over 12 months, nickel to fall to $15,000 per metric ton and lithium carbonate to slip to $10,000 per metric ton (down from a previous forecast of $11,000).
Prices of lithium carbonate in China on Tuesday traded at roughly 108,500 yuan ($15,071). Lithium prices are down nearly 70%, compared to the same period last year.
Nickel prices on the London Metal Exchange (LME) were last trading at $17,945 per metric ton on Tuesday, while cobalt prices on the LME stood at $28,550 per metric ton.
Analysts have previously warned that the outlook for EV battery metals remains relatively subdued, with lithium, cobalt and nickel markets generally oversupplied.
“I would say the outlook remains fairly depressed, I think particularly for lithium and nickel, [which have] lengthening supply balances,” Tim Bush, electric vehicle battery research analyst at UBS, told CNBC’s “Squawk Box Asia” on Jan. 9.
“Now, that’s not necessarily a bad thing because it means that batteries will be less expensive for automakers so it helps alleviate some of the pain that some of the U.S. and European automakers have been experiencing,” Bush said at the time.
Germany’s largest offshore wind farm under construction, EnBW’s He Dreiht, just hit a big milestone: The first enormous turbine is now up in the North Sea.
He Dreiht – which means “it spins” in Low German – is using Vestas’s massive 15 megawatt (MW) turbines, the first project in the world to install them. Just one spin of one of the rotors can generate enough electricity to power four households for an entire day.
When it’s finished, He Dreiht will have 64 mega turbines cranking out 960 megawatts (MW) of clean power – enough to supply around 1.1 million homes. And it’s being built without any government subsidies.
EnBW, one of Germany’s major energy companies, has been working in offshore wind for more than 15 years, but He Dreiht is their biggest project yet. “It will play a key role in helping us to significantly grow our renewable energy output from 6.6 GW to over 10 GW by 2030,” said Michael Class, who heads up EnBW’s generation portfolio development.
The project is a win for Vestas, too. “With the installation of the first V236-15.0 MW, we have reached an important milestone for both the He Dreiht project and our offshore ramp-up, which helps Germany build a more secure, affordable, and sustainable energy system,” said Nils de Baar, president of Vestas Northern & Central Europe.
He Dreiht is located about 85 kilometers (53 miles) northwest of Borkum and 110 kilometers (68 miles) west of Helgoland. At peak times, more than 500 workers will be out at sea building the farm, using a fleet of more than 60 ships. EnBW’s offshore team in Hamburg is running the show.
The installation process is a major operation. The 64 foundations were already set in the seabed last year. Parts for the turbines are loaded onto the installation vessel Wind Orca in Esbjerg, Denmark, and shipped out in a 12-hour journey to the construction site. From there, the turbines are lifted into place. Meanwhile, crews are also working on internal wind farm cabling.
A partner consortium made up of Allianz Capital Partners, AIP, and Norges Bank Investment Management owns 49.9% of the shares in He Dreiht.
Read more: Trump admin halts $5 billion NY offshore wind project mid-build
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Tesla has released a quick update about its Tesla Semi factory in Nevada. It says that it is on track for volume production of the electric semi truck in 2026.
The Tesla Semi was first scheduled to go into production in 2019, but it has faced numerous delays.
Now, it appears that there is finally some momentum to bring it to volume production.
For the last two years, Tesla has been working to build a new factory next to Gigafactory Nevada, where it builds the battery packs and drive units for most of its electric vehicles built in North America.
Today, Tesla released a “progress update on the factory, confirming that it finished building and it’s now working on deploying the production lines:
Tesla had previously mentioned aiming for volume production by 2025, but it is now only talking about starting production toward the end of the year and ramping up next year.
The automaker reiterated its planned production capacity of 50,000 units.
We recently reported that an early Tesla Semi customer, Ryder, stated that the electric truck program is experiencing more delays and a price increase described as “dramatic.”
They now expect to take deliveries of their first trucks later in 2026 and said that the price has increased “dramatically,” leading them to scale back their pilot program from 42 to 18 Tesla Semi trucks.
When originally unveiling the Tesla Semi in 2017, the automaker mentioned prices of $150,000 for a 300-mile range truck and $180,000 for the 500-mile version. Tesla also took orders for a “Founder’s Series Semi” at $200,000.
However, Tesla didn’t update the prices when launching the “production version” of the truck in late 2022. Price increases have been speculated, but the company has never confirmed them.
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Vietnamese solar panel maker Boviet Solar just opened the doors to its first US factory — a huge new PV module plant in Greenville, North Carolina.
The company dropped $294 million into the state-of-the-art facility, which will pump out Boviet’s Gamma Series monofacial and Vega Series bifacial solar panels. They’re using advanced PERC and N-Type solar cell tech, which basically means these panels are built to deliver higher efficiency and better performance across residential, commercial, industrial, and utility-scale projects.
The Greenville factory’s first phase is now online with an annual PV module output capacity of 2 gigawatts (GW). For Phase 2, which is scheduled to come online in the second half of 2026, Boviet will invest another $100 million to add 600,000 square feet and ramp up to another 2 GW. It will make high-efficiency solar cells.
Once both phases are complete, Boviet’s campus will cover more than 1 million square feet of manufacturing and R&D space. It’s one of the biggest clean energy manufacturing projects North Carolina has ever seen.
The jobs impact is significant, too. The first phase will create 460 skilled local jobs. Phase 2 is expected to add another 908, bringing the total to over 1,300 direct jobs, plus nearly 2,000 more indirect jobs across the region. That’s good news for Pitt County’s economy, real estate market, and workforce training programs.
“This facility is not just creating jobs, but creating opportunity, innovation, and a stronger foundation for eastern North Carolina,” said Senator Kandie Smith. Governor Josh Stein added that Boviet Solar’s move shows how North Carolina is leading the way in clean energy growth.
Read more: Thomas Built Buses debuts its next-gen electric school bus
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