G Sachs: Future Lithium Cycle to Be Demand-led, Expects Lithium Carbonate Prices to Peak in 1H26
I'm LongbridgeAI, I can summarize articles.G Sachs forecasts that the future lithium cycle will be driven by demand, with lithium carbonate prices expected to peak at RMB164,000 (approx. USD21,000) in 1H26. A supply surplus of 20-22% is anticipated in 2H26 and 2027, despite a tight market in early 2026. The report highlights significant growth in energy storage systems and electric vehicles as crucial for sustaining the lithium upcycle. Additionally, supply disruptions in Zimbabwe could impact availability in 2027. GANFENGLITHIUM and TIANQI LITHIUM have had their target prices raised but maintain a 'Sell' rating.
G Sachs said in a research report that the lack of greenfield investment projects in the near term suggests limited long-term supply elasticity for lithium. As such, the trajectory of the future lithium cycle will primarily depend on demand strength. For the lithium market to sustain an upcycle in 20262027, both energy storage systems (ESS) and electric vehicles must record substantial growth.
Under its base-case scenario, the broker expects benchmark lithium carbonate prices to peak in 1H26 at RMB164,000 per tonne (approximately USD21,000), before retreating in 2H26 through 2028 to between USD10,100 and USD16,000 per tonne of lithium carbonate equivalent.
On the demand side, its data show that the global lithium market will remain tight in 1H26, but a supply surplus of 20% to 22% is expected in 2H26 and 2027. Based on monthly electric vehicle sales and ESS battery shipment data, the broker estimates that global lithium demand in the first three months of 2026 rose 25% YoY.
On the supply side, the broker estimates that the industry will add 1 million tonnes of additional lithium carbonate equivalent capacity in 20262027, equivalent to nearly 50% of demand. Most projects are being developed by Chinese producers, with over 60% set to commence production in 2H26. Potential supply disruptions in Zimbabwe could reduce supply by 5% in 2027.
GANFENGLITHIUM (01772.HK) +3.400 (+4.082%) Short selling $64.22M; Ratio 8.604% had its TP raised from HKD35 to HKD60, with rating maintained at "Sell"; TIANQI LITHIUM (09696.HK) +1.150 (+1.731%) Short selling $78.93M; Ratio 22.787% had its TP lifted from HKD26 to HKD48, with rating maintained at "Sell". (ss/u)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-05-04 16:25.)
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