Prices.... Going Up!!!

[Mystic]

LITHIUM (INSTALLMENT THREE)

Once high-flying LITHIUM (I refer the reader to my INSTALLMENT 1 entry @ this thread, when LITHIUM VALUES were skyrocketing, peaking @ circa October 2022) is still @ a decline that began around late autums 2022 and has continued, steadily, through .... well, today, as since November 2022, the average price of battery-grade lithium carbonate in China has plunged from $84,500 per metric ton to $42,500, or about a 50% decline:

LITHIUM CARBONATE PRICES (USD/MT) --- Q1/2019 > Q1/2023

Source: Bloomberg Data (20 March 2023)

Presumed Cause(s)

Industry representatives and market traders aver that lithium carbonate has experienced a significant decline in overall demand in recent months resulting from (1) deceleration in electric vehicle sales and (2) increasing supply of the key ingredient used in battery packs.

Related: Cobalt and Copper

Cobalt, another crucial component in batteries, has seen prices plummet by over 50%. Meanwhile, copper, a key metal in electric motors and batteries, has experienced an 18% decline.

Upside(s)

The decline in lithium prices could make EVs more affordable by lowering the cost of battery packs. Bad for the automakers but good for consumers.

 

[quiet]

LITHIUM (INSTALLMENT THREE)

Once high-flying LITHIUM (I refer the reader to my INSTALLMENT 1 entry @ this thread, when LITHIUM VALUES were skyrocketing, peaking @ circa October 2022) is still @ a decline that began around late autums 2022 and has continued, steadily, through .... well, today, as since November 2022, the average price of battery-grade lithium carbonate in China has plunged from $84,500 per metric ton to $42,500, or about a 50% decline:

LITHIUM CARBONATE PRICES (USD/MT) --- Q1/2019 > Q1/2023
View attachment 2834456
Source: Bloomberg Data (20 March 2023)

Presumed Cause(s)

Industry representatives and market traders aver that lithium carbonate has experienced a significant decline in overall demand in recent months resulting from (1) deceleration in electric vehicle sales and (2) increasing supply of the key ingredient used in battery packs.

Related: Cobalt and Copper

Cobalt, another crucial component in batteries, has seen prices plummet by over 50%. Meanwhile, copper, a key metal in electric motors and batteries, has experienced an 18% decline.

Upside(s)

The decline in lithium prices could make EVs more affordable by lowering the cost of battery packs. Bad for the automakers but good for consumers.

I would speculate that a decline in the cost of batteries would result in more E/V sales to the poor folks and greatly benefit E/V makers.

 

[GChief]

E/V makers

I belive that is all the manufacturers at this point.

 

[quiet]

I belive that is all the manufacturers at this point.

They're trying. Some of the product has a ways to go.

 

[GChief]

They're trying. Some of the product has a ways to go.

I didn't realize that.

 

[quiet]

I didn't realize that.

I'm very anxious to see what's available 5 years from now.

 

[GChief]

I'm very anxious to see what's available 5 years from now.

That's why I put the brakes on with getting one this year. To many new ones coming out and the prices are dropping even with the "supply chain issues".

 

[quiet]

That's why I put the brakes on with getting one this year. To many new ones coming out and the prices are dropping even with the "supply chain issues".

That and the used market may look very attractive, for me. Particularly if battery availability and tech improves.

 

[BlindBoyGrnt]

^^^ PS:

And while we are not about to overturn the massive power of the rich in the financial system and the enormous network of elite opinion makers that supports them, but perhaps we can at least make the failure of SVB a teaching moment.

The rich are ripping us off big time. They are not lucky winners in a market competition due to their intelligence and hard work. They are people who have managed to rig the game to put big bucks in their pocket. That is the reality. We just have to find ways to change it. A key place to start is to stop pretending that their great wealth has anything to do with a free market.

So it goes.

Like the time lag with day traders.

 

[BlindBoyGrnt]

LITHIUM (INSTALLMENT THREE)

Once high-flying LITHIUM (I refer the reader to my INSTALLMENT 1 entry @ this thread, when LITHIUM VALUES were skyrocketing, peaking @ circa October 2022) is still @ a decline that began around late autums 2022 and has continued, steadily, through .... well, today, as since November 2022, the average price of battery-grade lithium carbonate in China has plunged from $84,500 per metric ton to $42,500, or about a 50% decline:

LITHIUM CARBONATE PRICES (USD/MT) --- Q1/2019 > Q1/2023
View attachment 2834456
Source: Bloomberg Data (20 March 2023)

Presumed Cause(s)

Industry representatives and market traders aver that lithium carbonate has experienced a significant decline in overall demand in recent months resulting from (1) deceleration in electric vehicle sales and (2) increasing supply of the key ingredient used in battery packs.

Related: Cobalt and Copper

Cobalt, another crucial component in batteries, has seen prices plummet by over 50%. Meanwhile, copper, a key metal in electric motors and batteries, has experienced an 18% decline.

Upside(s)

The decline in lithium prices could make EVs more affordable by lowering the cost of battery packs. Bad for the automakers but good for consumers.

Drop in lithium prices may also be caused by anticipated competition from new technologies, for example, sodium batteries.

 

[Mystic]

THE GREAT GOLD RUSH OF 2022-2023

GOLD / USD PER OUNCE / 22 SEPTEMBER 2022 > 23 MARCH 2023

Source: Trading Economics (2023)

The cost of one ouce of gold is up ~ 10% for the day.

Remember how, at the time of the 2008 Financial Crisis, we all thought gold had maxed out at $790 per ounce? And then it kept rising, reaching around $1,800 per ounce by February 2011? And then it started falling, though never less than around $1,100 per ounce in November 2015, since which time it hung on until July 2018, from which point it has only kept rising.

The latest movement is being assigned to such factors as

1. FRB increasing interest by 25 basis points
2. US Treasury reporting it is not considering "blanket insurance" for bank deposits

They'll tell us - again -- that the price of gold is highly sensitive to the rates outlook as higher interest rates lift the opportunity cost of holding non-yielding bullion and vice versa.

The "experts" know nothing about markets.
For that matter, most of us know nothing about markets.

 

[Mystic]

LITHIUM (INSTALLMENT FOUR)

Lithium Carbonate price (ChiNese Yuan / ton) decreased -35.29% between 28 February and 31 March 2023, bringing the Year-over-Year decline to -52.37%:


The YoY change presented in a lovely graph:

LITHIUM CARBONATE: CNY/Ton ... 31 MARCH 2022 > 31 MARCH 2023


So, what's going on @ the lithium carbonate market?

Lithium carbonate prices in China, have declined by nearly -53% YoY to CNY 240,000 per ton by 31 March 2023, the lowest level in 15 months, as robust output and a falling demand continued to support forecasts of a supply surplus this year. After subsidizing battery manufacturers and granting cash rewards to new electric vehicle purchases in 2022, China halted incentives for the new energy auto sector and catalyzed a decline in demand for battery inputs. The overproduction of batteries at the end of 2022 to take advantage of subsidies drove battery producers to have unsustainably high inventories,, prompting the sale of goods at a steep discount with sharp capacity cuts in all streams of the supply chain. Meanwhile, 8.5 million tons of lithium, equivalent to 10% of currently known world reserves, were discovered in a deposit in Iran

 

[Mystic]

CRUDE OIL (3 APRIL 2023)

After several weeks of declining or stablized PPB status, the Big Crude Petroleums -- i.e., US West Texas Intermediate, Brent, and Urals -- increased overnight on deliberate action by selcet OPEC and OPEC+ producers, announced late yesterday, to reduce production starting in May (2023) through the end of the year.

As of 8:50am Paris Time:

- WTI @ $79.46/bbl
- Brent @ $84.21/bbl
- Urals @ 59.02/bbl

WTI crude futures surged about 7% to above $80 per barrel this morning, its highest level in over two months after OPEC and OPEC+ producer states announced the (unexpected) production cut of more than 1 million barrels a day.

Brent crude futures surged about 7.3% to above $85 per barrel this morning, its highest levels in a month after OPEC and OPEC+ producer states announced the (unexpected)production cut of more than 1 million barrels a day.

In the background, this production cut complicates the outlook for inflation and interest rates, as investors had been betting that easing price pressures would give central banks room to pause the current monetary tightening (i.e., MT) cycle.

Also, a rising dispute involving Kurdish authorities which halted exports of around 400,000 barrels a day from the Ceyhan port in Turkey since last week is contributing to the tightening market and seems unlikely to be resolved anytime soon.

The member states making the largest production cuts, by barrels per day (BPD):

-500,000: Saudi Arabia
-211,000: Iraq
-144,000: United Arab Emirates
-128,000: Kuwait
-78,000: Kazakhstan
-48,000: Algeria
-40,000: Oman

These cuts, in combination with OPEC+ member state Russian Federation's having already decreased production by 500,000 BPD in mid March 2023, brings the sum production reduction among the OPEC and OPEC+ member states, between 15 March and 3 April 2023, to MINUS 1,649,000 BARRELS PER DAY.

Futures trading of WTI, Brent and Urals re: USD/BBL by Q1/2024 as of 3 April 2023:

- WTI: $86.66/bbl
- Brent: $90.58/bbl
- Urals: $70.15/bbl

While these predicted costs per barrel are dramatically lower than the peaks reached in May-July 2022, economic and geopolitical instabilites in general, and the worldwide financial crisis and probablity of escalation of the war in Ukriane, combine to create a highly unstable market in energy and other commodities.

 

[YY1]

We had 2 days of $3.09 to $3.11 last week after a few weeks of $3.29.
Then overnight most went to $3.29 again, and by the next day were $3.49 where they stayed all week.
Some have crept down to $3.47 in the past 2 days.

 

[nasadowsk]

I have a poorly built extension to my house that needs a replacement. Materials costs have basically put it on hold for just a shore-up job fir now. What would have been $10,000 3 years ago is now a $30,000 project.

 

[_Void_]

In my particular situation the high cost stems from resellers. I came home one day to my gaming desktop no longer producing a signal (hence me going radio silent for a while) and I narrowed down the issue to a bad CPU or mobo. I discovered relatively quickly that swapping the bad board/CPU to troubleshoot the issue was not economically feasible anymore because now those parts I need are selling at inflated prices (sometimes 4x MSRP). The only good reason I could find for this is due to them not being made or stocked anymore...but most common sense shoppers wouldn't waste their money on AM3 and the Bulldozer chips at this point.


So for much less than the cost of buying a used FX-8350 and GA-990FXA-UD5 mobo I purchased a late 2014 Mac Mini (i7, 8GB ram, 256GB SSD) and a USB Superdrive to hold me over until I buy all the parts needed for the build. Until that arrives later this week, I've been using my old 2013 Sony Vaio with Fedora 37 plugged into my monitor but it's less than ideal as a daily driver if I plan to have more desktop space and want a smoother desktop experience.

 

[Mystic]

In relation to the USD...

EURO: EU's currency touched $1.11 earlier this afternoon, @ the moment it's around $1.105
UK POUND: It reached a solid $1.25 and is still hovering @ that level.

Reason (one, anyway):

Investors be dumping the USD on expectations that The FED might pause its tightening policy campaign after May's hike after data added to signs of easing inflationary pressure and a slowdown in the US labor market.

Summary:

Lovely for my Luxembourg-based earnings, ugly for my US-based earnings.

 

[YY1]

Nice to be diversified.

...except when they cancel each other out.

 

[Mystic]

Nice to be diversified.

...except when they cancel each other out.

Which they seem ever-destined (determined?) to do.

 

[chazix]

Am I missing something? (I'm not that good at spotting tongues in cheeks online.) Is cancellation not precisely the reason for diversification?