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Koby Kushner of Libra Lithium talked to me about the lithium in this episode. Are we heading into a real bull market or another short-lived hype cycle? We dig into why China still drives demand and price discovery, why stationary energy storage has become the sleeper catalyst analysts underestimated, and why electrified trucks and developing markets could keep demand surprising to the upside. On the supply side, we get into the swing-supply boogeymen (Chinese lepidolite and African DSOs), what’s changed with Chinese regulations and Zimbabwe export policy, and why flooding the market again may be harder in a much larger lithium market. We also talk incentive prices for new supply, why spot prices can still spike in tight markets, what could actually flip the bull thesis bearish (clays, DLE, and policy-driven supply), and whether lithium juniors even make sense in this environment.

TL;DR

According to Koby, lithium’s likely setting up for a new bull phase, but this time it’s less Western EV hopium and more China plus a big, underappreciated kicker from stationary energy storage and even electrified heavy trucks, while supply looks less able to flood the market quickly like last cycle because the market is bigger, Chinese lepidolite has gotten costlier under tighter regs, and African policy (Zimbabwe export restrictions) is adding friction. Analysts are converging on a return to deficits by year-end (after slight oversupply), which could trigger sharp spot-driven price spikes like 2022 even if long-term incentive pricing for new projects sits around the mid-$20k/t range for chemicals, and the main bear risk isn’t demand imploding so much as surprise supply from clays/DLE actually working at scale with major/government backing.

The demand story is different this time.

Kushner’s point is that the lithium narrative is not driven by whether Americans feel emotionally ready for EVs. China is already the center of gravity (majority of new-car sales being EVs, trending higher), and the real plot twist is stationary energy storage. Analysts underestimated it, and it has already grown to rival or exceed past EV-driven demand. Layer on electrified heavy transport in China (big batteries, big lithium), plus emerging markets leapfrogging straight to cheaper Chinese EVs, and you get a demand base that is broader than last cycle. So, it’s not one narrow vein (EVs), it’s a widening alteration halo (EVs + storage + trucks + developing world).

Supply surprises won’t flood the market as easily (but they still could).

Kushner argues the lithium market has scaled up fast (roughly ~0.8 Mt in 2021/22 to ~1.5 Mt last year, possibly ~2 Mt soon), which makes price control and rapid rebalancing tougher. He also frames 2025 as flipping from slight oversupply toward a meaningful deficit by year-end (consensus-ish, with estimates around ~70 kt on the low end), and emphasizes that the deficit magnitude could be several times 2022’s deficit that helped launch the last price spike. Meanwhile, key swing sources look less on-a-whim. Chinese lepidolite is higher cost after regulatory changes, and African/Zimbabwe policy is pushing against simple concentrate exports. So, the supply response may be slower, more political, and more expensive than people anchored to the last boom-bust expect.

Spot spikes can still happen because lithium trades like a small-market commodity when it gets tight.

CEO Kushner works back to an incentive framework that lands around ~US$26k/t (US$26/kg) for chemicals to motivate new traditional supply (very rough, but a useful compass), while noting producers can sometimes accept lower floors in contracts. He cites a recent example of a spodumene floor around ~US$800/t SC6 (with upside retained) as evidence that floors can be below theoretical incentive prices for certain assets. At the same time, he won’t rule out another 2022-style squeeze because the extreme highs were mostly thin spot volumes. So, incentive pricing suggests where long-term projects pencil, but near-term pricing can still overshoot when the market panics.

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