I think it is generally agreed that Lithium will probably benefit from the rise of sustainable energy. It is a key component in a number of batteries and other components needed for a move to Green Energy.
It is however not the only possible solution, though it might be fair to say it has front runner advantage. And the backing of some significant names (Tesla).
The Chinese have a very significant hold on the Lithium asset/mine market. Not just in China but in significant holdings around the world.
Much of the current market is built on hype. People talk about battery factories, electric vehicles, etc but in reality an awful lot of this is just talk. There is only a limited number of contracts for supply available to be won or being signed.
As such currently the lithium market is in oversupply. The producers are essentially price takers and the users will buy spot as they have limited worries about supply.
Because the price is low there are only a limited number of people developing new projects, though a number of the existing ones can be expanded fairly easily.
Given this there is limited expectation of a move in pricing any time soon. However there are a number of initiatives that suggest that demand will significantly grow over the next 10 years. Perhaps as much as ten fold. Much as with "the cure for low oil prices, is low oil prices" this demand growth is very likely to create supply shortages. If that happens pricing will rapidly rise and with that the price of lithium plays.
Personally I have some difficulty in seeing this starting before 2022 and a lot of the modelling is very dependant on either the Biden led US demand for EV's becoming genuine or significant uptakes in battery manufacture as some of the Gigafactories being talked about begin to get delivered. However stock markets are forward looking, so the rise in valuation should be both earlier than the rise in prices and may well be significant. As such I have taken, via a basket of equity plays, a small (circa 1.5% of portfolio) position in Lithium.
This is not a sure bet and whist they are relatively rare there is analysts who suggest that either Lithium has had its day as alternative technologies will supercede or in fact Lithium will never get a day. As it is I am looking at a 50% down or a 10 times gain. However this is over a 5-6 year period (for the upside, the downside could come tomorrow). And the time of return does effect the rate of return.