Lithium miners dive as UBS says prices to stay 'lower for longer'
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The news: Lithium majors weighed on the ASX as UBS said it expects lithium prices to remain "lower for longer".
The numbers: Shares in Pilbara Minerals (-3.8%), Mineral Resources (-1.2%), IGO (-0.9%), Liontown Resources (-0.3%) were all lower by 1pm AEST. Materials was the only sector across the ASX in red, shedding 0.2%.
UBS said that growing lithium surpluses made any short-term price rebounds unlikely and lowered its lithium price forecasts by 10% in 2024, 7% in 2025, 4% in 2026 and 10% in 2027.
The context: UBS analyst Levi Spry warned that lithium markets remained "well-to-over supplied", with increased uncertainty on the long-term demand outlook outside of China, as well as continued opaqueness on near-term supply additions from China and Africa.
UBS has retained its 'sell' rating on Pilbara Minerals, Mineral Resources and IGO, where "valuations still appear stretched", while remaining 'neutral' on Liontown Resources. It has kept its 'buy' rating on smaller ASX rival Patriot Battery Metals.
The source: UBS research
