Economist from SANU on lithium extraction: "Pitiful" mining rent is not worth it for Serbia

“Since the president announced a public debate on this issue, I will try to make a modest contribution, starting with basic calculations. What is the planned production? Currently, it is 58,000 tons of lithium carbonate, which is suitable for battery production and traded on global markets. What is the current price of lithium carbonate? On June 18, 2024, the price was 12,900 dollars per ton, the lowest in the previous 35 months, and by July 15, it had fallen another 10 percent, to 11,538 dollars”, he noted.
Mijatovic wrote that in the Ergo Strategy Group study for Rio Tinto, all calculations are based on a lithium price of 15,600 dollars per ton, significantly higher than the current price, and if prices do not increase by more than a third in the coming years, the Jadar project would incur losses.

In 2022, it was believed that the revolutionary replacement of internal combustion engines with electric motors was imminent, so the price of lithium skyrocketed. By the end of 2023, great optimism had waned as it became clear that there was no revolution.

He also argued that electric cars are still not that popular with consumers due to higher prices, insufficient mileage per charge, and an inadequate number of chargers.
On the other hand, high lithium prices have attracted investors, significantly increasing supply just when demand was much lower than expected. A significant surplus of supply emerged, causing prices to drop by around 80 percent. Additionally, the value of lithium miners and producers' shares fell by 55.7 percent in one year, from July 2023 to July 2024, according to S&P Global.