Could The Battery Boom Lead To A Lithium Shortage?
The battery boom shows no signs of slowing down, as demand for lithium-based electric batteries continues to grow worldwide. With forecasts indicating a significant rise in the world’s electric car fleet, suppliers look to new sources of lithium, the mineral essential to battery construction.
Yet accessing and securing new lithium sources may prove difficult as demand grows and supplies become harder to come by; that could presage a major bump in world lithium prices.
As Bloomberg reported, world lithium suppliers were caught off guard by the marked increase in lithium demand that accompanied the boom in electric car manufacturing. Projects such as Tesla’s Gigafactory in Nevada, which hopes to produce 500,000 car batteries per year, indicate that the demand on lithium mines will only increase, encouraging mining companies to expand operations. Yet much of the demand will likely come from China, where fifty-five percent of global lithium-battery production is based, compared to ten percent in the United States.
Companies based in Australia, one of the world’s major sources of the mineral, are pushing for more production and greater upstream-downstream cooperation, to ensure the finished product meets industry needs. As investment in downstream lithium-based manufacturing grows, investors in Australia are rushing to secure more supply.
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