Armando Alatorre
College of Mining Engineers, Metallurgists and Geologists of Mexico - CIMMGM
Expert Contributor

China Corners Lithium Market but the Metal’s Nature is Global

By Armando Ernesto Alatorre Campos | Thu, 08/05/2021 - 13:09

With industrial minerals and rocks, the market is the central element of the equation. On one side, are the providers: who, where, how; on the other, the consumers: who, where, how, why. When talking about lithium, there is no exception.

The principal producers are Australia (pegmatites), Chile (brines), and China, which together accounted for 87 percent of 2020 production (82kt). In the case of China, it produced pegmatites (56 percent) plus continental brines (44 percent). Consider also that the nationality of lithium is not necessarily the same as that of the producing company; lithium is a global business.

The relevant producers and their mines are:

  • Albermarle, Charlotte, North Carolina, US. It represented around 22 percent of the 2020 world production from its 49 percent share of the Greenbushes pegmatite mine in Australia. It also holds a 60 percent interest in the Wodgina pegmatite in the Pilbara region. In addition, it has brine operations in Salar de Atacama and Silver Peak, Nevada.
  • Sociedad Química Minera (SQM), based in Santiago de Chile. It rendered 20.8 percent of the 2020 world production. It operates the Salar de Atacama brines. In addition, it has a 50 percent participation with Kidman Resources at Mount Holland for a future pegmatite operation in Western Australia.
  • Ganfeng Lithium Co. from Xinyu, China accounted for 17.3 percent of the world's 2020 production, operating its Ningdu River pegmatite at Ganzhou, Jiangxi. It also works in Australia (50 percent in Marion Lithium that belongs to Mineral Resources) and 6.86 percent in Pilbara; these two are pegmatite producers. It also holds a 51 percent stake in the Argentinian Cauchari-Olaroz brine deposits (Jujuy province) under construction. In addition, it has 82.5 percent of the Marina (Salta province) brine project in that same country where a feasibility study has just finished. Furthermore, it already participates with 48 percent of the Mexican clay deposit at Bacadehuachi (not yet producing). In addition, it collaborates in the exploration of the Avalonia pegmatite (Ireland).
  • Tianqi Lithium, from Sichuan, China. Represented 9 percent of the 2020 world production; this company owns 51 percent of the Greenbushes mine in Australia. It has obtained a mining license for the Cuola mine in the Yajiang province. In addition, it has a 23.77 percent participation in Chilean SQM.
  • Livent, formerly known as FMC, booked 6.1 percent of the 2020 world production from the Salar del Hombre Muerto in Argentina. In addition, it holds a 25 percent participation in the Nemaska pegmatite (exploration) in Quebec, Canada.
  • Minerals Resources from Applecross, Western Australia has the Marion Lithium mine. It also owns a 40 percent interest in the Wodgina pegmatite in the Pilbara region.
  • Galaxy Resources, based in Perth, Western Australia, has the Mt. Cattlin pegmatite mine. Further, a feasibility report ended last year in the Salar de Vida (brine), located in Catamarca province, Argentina. In addition, also last year, a preliminary economic assessment was concluded for the James Bay pegmatite project in Quebec.
  • Orocobre from Brisbane, Australia, produces from the brine operations at Salar de Olaroz, Jujuy province, Argentina, a 50:50 joint venture with Ganfeng Lithium Co.
  • Pilbara Minerals, based in West Perth, Western Australia, extracts pegmatites from its Pilgangoora operation.

On the side of the consumers, there are tens of lithium-based compounds used in industries as diverse as glass and ceramics, lubricants, metallurgy, pharmaceuticals, polymers, nuclear, and, obviously, the battery sector. The latter ranges from the tiny batteries for cellphones, which require just a few grams of lithium, through a series of different sizes for tablets, laptops, cameras, hand tools and up to electric plug-in vehicles (EV), where around 50-60kg of lithium are required.

As sales of new internal combustion cars will end in the next 15-25 years (depending on the region) because of green policies around the globe, sales of EVs will grow around 20 percent yearly in the next decade. Therefore, the need for a lot more Li-batteries is prognosticated and is why the world is now looking at the “lithium rush.” A recent study from the automotive industry points to an increase in an installed capacity to produce such batteries from 475GWh (2020) to more than 2,850GWh by the end of the present decade. An EV battery equals (on average) 50KWh (50,000 watts/hour) so, 1GWh-installed plant capacity produces around 20,000 batteries annually.

Not all batteries, however, are created equal. First of all, they contain either lithium carbonate or lithium hydroxide. Furthermore, they are not made out of only of those compounds: several mining products are needed. Talking about Li-ion batteries for EVs, there are, currently, seven different types: LFP (lithium iron phosphate), LCO (lithium cobalt oxide), LMO (lithium manganese oxide), NMC (lithium, nickel, manganese, cobalt oxide), NCA (lithium nickel, cobalt, aluminum oxide), NCM (lithium, nickel, cobalt, manganese) and solid-state batteries (ceramic separator instead of a liquid). The names and components refer to what makes the cathode. Each battery type has pros and cons due to the held energy and the time it remains in the cell. There are even several formulas for a given type. Cobalt, for example, is neither easily found on the market nor cheap.

The process for an EV battery is complex and segmented. There are nine principal cathode producers (six in China); the anodes have six relevant producers (four from China); there are nine leading electrolytes factories (six Chinese); and there are 17 top cathode-anode separator plants (11 in China). Finally, the plants where all these components are put into an EV battery account for as many as 20 leading firms with a cited installed capacity of 475GWh; 15 are in China, three are in South Korea, with one each in Japan and France.

No matter where lithium comes from, most of it ends up in China, at least for the time being. The global number of battery-producing plants today is around 102. It is likely that another 226 will come on stream by 2030; however, the vast majority will still be in the Asia-Pacific region.

Photo by:   Armando Alatorre