Limited Funding, Regulations Leave Mexico Behind in Lithium Race

Although lithium has been declared a strategic resource, Mexico’s sector faces challenges from limited funding, regulatory restrictions, and insufficient technical capacity. Meanwhile, countries such as Chile and Australia continue to strengthen their positions, leaving Mexico behind in the global push for energy transition and electric mobility.

Rubén del Pozo, President, AIMMGM, noted that although lithium was declared strategic and reserved to the state in 2022, structural challenges remain. He stressed that LitioMx was created without sufficient funding or proven technical expertise, constraining any meaningful progress.

“Lithium is not just something you can extract and sell for profit. First, you need to know where it is, how much exists, and in what condition. That requires time, money, and technology,” Del Pozo explained.

He questioned whether the state alone can carry out exploration processes that typically require multi-million-dollar investments and long timelines, especially given Mexico’s limited geological knowledge of the mineral. “Who is in charge of lithium? LitioMx. And what is its budget? Very limited. Exploration demands massive investment and time. Is LitioMx capable? No,” he added.

The urgency is heightened by rapidly growing global demand for lithium. Production exceeded one million tons of lithium carbonate equivalent (LCE) in 2024 and is expected to reach 1.22Mt in 2025, marking a year-on-year growth of more than 20%. The US Geological Survey projects that demand will surpass 3Mt by 2030, representing nearly a fivefold increase in production.

“While Mexico debates state control of lithium, the global automotive industry is already securing supply contracts elsewhere, leaving the country out of the investment race for batteries and electric vehicles,” said Armando Alatorre, Vice President, CIMMGM.

Mexico’s mining regulations exacerbate the situation. While the government promotes lithium as a strategic project, it maintains restrictions on open-pit mining, an essential method for its extraction. “Lithium cannot be mined underground; it must be open-pit. On one hand, it is presented as a mineral that could lift the country out of poverty; on the other, the method required to extract it is prohibited. This reflects technical misunderstanding,” Del Pozo said.

Another significant challenge is investment. For the third consecutive year, LitioMx will receive a budget covering only operating expenses, including salaries and administrative costs, preventing the company from advancing projects that could boost national lithium production. 

According to Mexico’s 2026 Federal Budget, LitioMx is allocated MX$13.9 million, a 7.7% increase over the MX$12.9 million in 2025, which itself represented a 27.3% rise from MX$9.8 million in 2024.

Mexico holds an estimated 1.7Mt of lithium reserves. Although this volume is modest compared to other Latin American producers, analysts believe the country could strengthen its position in the global market if it accelerates investment and development. Mexico currently has 82 identified lithium deposits across 18 states, with notable concentrations in Sonora (13), Puebla (12), and Oaxaca (9).