Why Latin America is unlikely to form an OPEC-like cartel for lithium
Demand, regional politics likely to hold back competition with China, Australia.
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(Michael Molinski is a senior economist at Trendline Economics. He’s worked for Fidelity, Charles Schwab and Wells Fargo, and previously as a foreign correspondent and editor for Bloomberg News and MarketWatch.)
SANTIAGO, Chile (Callaway Climate Insights) — Chile, the world’s second-largest producer of lithium, announced plans last month to bring the industry under state control. Bolivia, Argentina and Chile have already hinted at creating a cartel that would oversee the production and prices of lithium, much like the Organization of the Petroleum Exporting Countries. Brazil, Peru and Mexico may join, too.
But there’s one thing holding back from making those dreams a reality — demand.
Unlike oil, lithium is not a transactional commodity. You can’t pump your gas tank full of lithium…
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Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.
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