The Pilbara Minerals Ltd (ASX: PLS) share price is bouncing higher on Monday after hovering around 1-month lows of $2.
At the time of writing, shares in the lithium producer are up 6.34% to $2.18.
Pilbara Minerals share price rallies on record lithium prices
Lithium spot prices have continued to climb despite the Pilbara Minerals share price trading sideways since mid-August.
According to S&P Global, lithium hydroxide prices have continued to strengthen, marking an all-time high of US$20,000 metric tonne (mt) on 8 September.
“China domestic lithium carbonate prices have surged over 50% from the start of August — rising to Yuan 140,000/mt Sept. 8 from Yuan 91,500/mt Aug. 2.”
The report highlighted a bullish landscape for lithium in China, citing “… there is also very limited spot availability of cargoes, a Chinese trader said. Sellers are likely to continue raising offers for any spot cargoes, given the higher prices for lithium carbonate and spodumene as feedstock” the source added.
“Previously, the surge in prices in June was fueled by strong spot demand from Japan and South Korea on lower allocation of term contract supply volumes” another producer said.
Top things off with a bullish broker note
The Motley Fool reported this morning bullish commentary for the Pilbara Minerals share price from Macquarie Group Ltd (ASX: MQG).
Its analysts retained an outperform rating with a $2.70 target price for the lithium miner’s shares.
This was backed by its positive view for the lithium market and Pilbara Minerals’ growing production capabilities.
The broker pointed to the ramp up of its Pilgan and Ngungaju operations as major growth drivers with the ability to “support a seven-year production growth rate of around 20% per annum”.
In terms of recent production, Pilbara Minerals produced 281,098 dry metric tonnes (dmt) in FY21. And forecasts FY22 production to ramp up between 460,000 to 510,000 dmt.
The post Pilbara Minerals (ASX:PLS) share price up 6% on Monday as lithium prices hit record high appeared first on The Motley Fool Australia.
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Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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