China’s EV push fuels lithium demand
The Asian giant’s move towards electric vehicles, particularly for buses and commercial vehicles, will ensure that lithium remains a cornerstone of battery technology. By Sebastian Lewis.
Demand for lithium, one of the key materials used in making lithium ion batteries, is rising rapidly. The metal is used in a wide variety of industrial applications including glass, ceramics and greases. But it’s the use of lithium as a key component in the batteries powering electric and hybrid electric vehicles that has so excited markets.
Lithium does not occur naturally in nature. Instead, it is found in a variety of mineral salts, which need to be chemically processed to form the lithium compounds and chemicals required by industry. A number of lithium compounds are used by industry, but lithium carbonate is the most commonly used form of the metal, accounting for more than half of total demand. The lithium industry often expresses lithium production and trade in lithium carbonate equivalent (LCE) units.
If EVs, which rely wholly or partly on electricity stored in batteries as their source of energy, revolutionize road transport in the way many expect, demand for lithium will rise exponentially. China will be at the forefront of this. China is already the world’s largest market for EVs, accounting for nearly half of global sales last year. This trend is expected to continue, supported by government policies driving the development and adoption of electric vehicles. This will require a significant increase in both lithium carbonate and increasingly lithium hydroxide, another lithium compound, which is preferred for making the next generation of lithium battery technologies.
China accounted for slightly more than half of total global production last year, producing 123,000 mt LCE, according to statistics from the China Nonferrous Metals Industry Association (CNMIA). Of this, 83,000 mt was lithium carbonate, with the remainder comprising other compounds, such as lithium hydroxide, lithium chloride and lithium metal.