With the rapid expansion of the electric vehicle market, the demand for battery raw materials has been pushed to a peak. A recent Goldman Sachs report poured cold water on this boom.

According to foreign power news on March 5, Goldman Sachs recently released a report saying that it is too early to think that the end of the collapse in battery raw material prices is too early, and warned that the increase in key supply and the decline in demand for electric vehicles in Western countries may keep prices lower for a longer period of time.

In the report, Goldman Sachs analysts analyzed the current supply and demand situation of the battery raw material market in detail and gave a forecast for the price trend in the next few years. Goldman Sachs said it expects the lithium and nickel surpluses to remain substantial in 2024 due to the increase in key supply and the decline in demand for electric vehicles in Western countries. This means that the prices of these two key battery raw materials are likely to continue to experience downward pressure in the coming years.

To illustrate this view more concretely, Goldman Sachs analysts also gave projected declines in cobalt, nickel and lithium carbonate over the next 12 months. According to their forecasts, cobalt, nickel and lithium carbonate are expected to fall by 2%, 15% and 25% respectively over the next 12 months. This means Goldman Sachs expects cobalt prices to trade at $26,000 a tonne over a 12-month period, down from a previous forecast of $28,000, nickel prices to fall to $15,000 a tonne and lithium carbonate prices to $10,000 a tonne, down from a previous forecast of $11,000.

This forecast is undoubtedly a huge challenge for the entire battery industry chain. The continued decline in raw material prices is likely to reduce the cost of battery production, thereby driving the rapid development of applications such as electric vehicles. However, this can also lead to some suppliers falling into difficulties or even withdrawing from the market, further affecting the stability of the entire industrial chain.