At the time, the boom came to an end fairly quickly as producers ramped up output.
Now, lithium is once again rallying ahead of what most see as the almost complete electrification of transport.
But this time is different.
Back in 2015, when the previous lithium price rally began, Tesla was hogging headlines while the big carmakers were mostly in a business-as-usual mode.
They were developing electric models, but nothing like the lineup the likes of VW, Renault, GM, and Ford have been announcing over the past year or so.
Now, the auto majors are actually planning to become all-EV in the not too distant future - in line with government policies.
With such plans by the world's biggest carmakers, demand for lithium is set to enjoy a prolonged rally.
This is prompting buyers to turn to what they used to shun: long-term contracts.
A Benchmark Mineral Intelligence analyst told Reuters:
- Prices are up over 230% year to date, really around a lack of available material
- As a result, people are willing to sign up for longer-term contracts going into 2022 with more frequent price breaks
Bloomberg last month reported that because of the soaring demand for lithium, buyers are not only opting for long-term contracts, but also buying lithium mining assets themselves to secure supply, as new lithium mining capacity has been slow in coming due to price fluctuations and some projects have been delayed.
Joe Lowry, an independent consultant & mining industry vet, told Bloomberg in October:
- It's kind of like revenge of the miners
- The suppliers are in the driver's seat, and it's going to stay that way for a while
All in all, nobody expects an end to the current lithium price rally anytime soon.
This, however, is sparking a new worry: that it would take longer for EVs to reach cost parity with internal combustion engine vehicles.
Their manufacturers need to achieve this parity in order to be able to push EVs as an on-par replacement for gas guzzlers, but with all battery metals prices rising fast, the moment of that happening is moving farther down the road.
Currently, China is the lithium king of the world, and this certainly does not sit well with decision-makers in Europe or the United States.
This could spur new lithium mine development wherever there is lithium - and there is in the United States - but exactly how fast this new supply could come is still questionable.
Until it gets an answer, lithium prices - and EV prices - will remain elevated, and coupled with current inflation, trade could slow down the world's EV transition.