UBS has adjusted its projections for lithium prices in 2025 and 2026, expecting a tighter market despite a decrease in global demand.

The bank now predicts that supply growth will not keep up with demand growth, resulting in a reduction in the global surplus and a return to market equilibrium by 2027-2028.

UBS has reduced its supply estimate for 2025 by around 18% due to supply restrictions and project delays caused by a significant price drop. As a result, the bank has increased its spodumene price forecast, raising it by 7% to $800 per tonne for 2025 and by 17% to $850 per tonne for 2026.