there are two factors that control market prices: supply elasticity and demand elasticity.
commodities with inelastic supply and inelastic demand are prone to very wide price swings.
inelastic supply means that increasing prices don't increase supply. in the case of lithium, it take time to bring new production capacity online, so supply is very inelastic in the short term.
inelastic demand means that increasing prices do not decrease demand. in the case of lithium, batteries are a very valuable product, and the raw cost of lithium is a small percentage of their total value, so increasing prices for lithium do very little to reduce demand.
the price movement here is totally predictable and exactly what you would expect based on standard economic formulas taking into account supply/demand elasticity. it is not speculation or gambling.
demand went up, supply lagged, the price spiked, supply increased, the price went back down.
electric car sales may still be growing but growing at a lower rate, and projected demand growth is probably decreasing relative to projected supply, so the price is falling.
commodities with inelastic supply and inelastic demand are prone to very wide price swings.
inelastic supply means that increasing prices don't increase supply. in the case of lithium, it take time to bring new production capacity online, so supply is very inelastic in the short term.
inelastic demand means that increasing prices do not decrease demand. in the case of lithium, batteries are a very valuable product, and the raw cost of lithium is a small percentage of their total value, so increasing prices for lithium do very little to reduce demand.
the price movement here is totally predictable and exactly what you would expect based on standard economic formulas taking into account supply/demand elasticity. it is not speculation or gambling.
demand went up, supply lagged, the price spiked, supply increased, the price went back down.
electric car sales may still be growing but growing at a lower rate, and projected demand growth is probably decreasing relative to projected supply, so the price is falling.