"This is not a metal that's going to be exempt from the normal laws of commodity economics," analyst Paul Gait told Bloomberg.

"Sooner or later we will over supply."

In an indication of the growing demand for lithium, the London Metal Exchange is looking to introduce a contract for lithium.

Across the pond, monthly fundraising in Canadian financial markets for lithium companies exceeded C$40 million in four months of 2017, reaching a high of $115.8 million in June as the number of deals peaked at 14, according to data this month from Oreninc.com.

However Gait told the wire service that in the rush to meet demand, there was a risk too many mines would be developed and too much metal supplied.