Albemarle Corporation (ALB), the world's largest lithium producer, saw its stock surge 7.09% in pre-market trading on Thursday, as investors reacted positively to the company's bullish outlook on global lithium demand and electric vehicle (EV) market growth.

In a series of statements, Albemarle's CEO Kent Masters provided a highly optimistic forecast for the lithium industry. Masters expects global lithium demand to grow between 15% and 40% in 2025, with the most likely scenario being a 20% increase. Furthermore, he projected that global lithium demand would double from 2024 to 2030, underscoring the long-term growth potential in the sector.

The CEO highlighted several key drivers for this growth. Notably, China's EV market now accounts for 60% of global lithium demand, while grid storage applications represent 20%. Masters also predicted that global EV production would surpass internal combustion engine production by the end of the decade, further boosting lithium demand. Interestingly, lithium demand for grid storage grew faster in 2024 than demand from the EV market, indicating diversification in lithium applications.

Despite the positive outlook, Masters noted some challenges in the industry. He revealed that 40% of global lithium capacity is currently at or below break-even, emphasizing the need for "long-term lithium pricing well above current spot prices" to incentivize supply growth. This suggests that Albemarle may be positioned to benefit from potential price increases in the future.

The pre-market rally in Albemarle's stock suggests that investors are betting on the company's strong position in a growing market, despite recent price volatility in the lithium sector. As the largest lithium producer globally, Albemarle stands to benefit significantly from the projected growth in demand, especially as the world continues to shift towards electric vehicles and renewable energy storage solutions.