China to overtake Australia as world's top lithium miner by 2026, Fastmarkets says

Reuters

7 hours ago

LAS VEGAS, June 25 (Reuters) - China by next year will overtake Australia as the world's top miner of the battery metal lithium, according to a forecast from consultancy Fastmarkets, and its market prowess is expected to grow through 2035 even as many Chinese producers remain unprofitable.
The projections are the latest data point underscoring Beijing's commanding presence across the global metals supply chain, with China the dominant miner or refiner of more than half the minerals considered critical by the U.S. Geological Survey.
"China's got a very clear strategy to develop its mineral resources," Paul Lusty, the consultancy's head of battery raw materials research, told Reuters on the sidelines of the Fastmarkets Lithium and Battery Raw Materials Conference in Las Vegas.
Australia has been the world's largest lithium miner since taking that spot from Chile in 2017, but Australian miners have curtailed production or delayed expansions amid a global drop in lithium prices.
By next year, Chinese miners are likely to extract 8,000 to 10,000 more metric tons of lithium than Australian rivals, according to the Fastmarkets forecast. That would be a jump from 2023, when China was the world's third-largest lithium producer.
By 2035, Chinese miners are likely to extract 900,000 metric tons of lithium, compared to Australia's 680,000 metric tons, Chile's 435,000 metric tons and Argentina's 380,000 metric tons, according to the forecast.
Much of China's growth has and likely will continue to come from mining a type of hard rock ore known as lepidolite, which is prolific in the southern part of the country.
China's lepidolite mining is more costly than extracting lithium from salty brines and can cause more environmental harm due to toxic by-products such as thallium and tantalum that pollute water supplies.
China's lithium miners have been reticent to cut production due to support from the Chinese government, "pressure" from local municipalities to keep operations open - and thus local jobs, and a desire to maintain market share as demand for the metal rises, Lusty said.
"This continued production - despite the lack of profitability within the market - starts to make a lot more sense when you consider all those factors," he said.
Chinese battery giant CATL (300750.SZ), opens new tab is one of the largest producers of lepidolite and had paused production at a key mine last September before resuming output in February.
Beyond mining, China for years has been the world's largest refiner of the ultralight metal, with roughly 70% market share. Lithium refineries turn the metal into a form that can be used to make cathodes for batteries.
Efforts by other countries to grow their own lithium refining should cut China's market share to 60% by 2035, Fastmarkets forecasts.
China's market prowess also extends to electric vehicle supply chain, with more than 60% of all EVs globally sold last year in that country, according to data from battery producer LG Energy Solutions.