Since November, the average price of battery-grade lithium carbonate in China has plunged from $84,500 per metric ton to $42,500, or about a 50% decline, according to Bloomberg data. 

Vivek Chidambaram, the senior managing director for strategy at Accenture, a consulting firm, told NYT the plunge in lithium prices could be attributed to the slowdown in electric vehicle sales. He said tight supply last year, which resulted in skyrocketing prices, has shifted into surplus this year as suppliers are producing more battery-grade lithium carbonate than ever before. 

"There was a time when people believed electric vehicles would grow very rapidly. Then the reality of how fast they were actually growing caught up." He expects lithium prices to moderate over the next several years. 

In the second half of 2022, EV demand slowed due to China's ending of subsidies to stimulate sales in the world's largest EV market. Then in the US, the world's second-largest EV market, Tesla began discounting vehicles in December. 

On Monday, Matty Zhao, an Asia Pacific basic materials analyst at Bank of America Securities, told CNBC that last year's lithium shortfall, which sent prices soaring, could pivot into a surplus in 2023, with "a lot of supply coming out" from mines. 

"We are expecting 38% lithium supply growth this year. That's why 2023 is likely to turn into a surplus year for lithium," Zhao said. 

Cobalt, another crucial component in batteries, has seen prices plummet by over 50%. Meanwhile, copper, a key metal in electric motors and batteries, has experienced an 18% decline.

On a positive note, the decline in lithium prices could make EVs more affordable by lowering the cost of battery packs.