Global lithium production set to double in five years to meet EV demand

A new report from GlobalData predicts that electric vehicle (EV) demand will double global lithium production from 26,700 tonnes (t) in 2018 to 58,300t in 2022.

China is expected to lead this demand for EVs, accounting for more than 50 per cent of the 1.1 million new EV sales globally in 2017, with the US in second place at just over 17 per cent. China also boasts an anticipated growth three times that of the US from 2018–2022.

China, also the world’s largest car market generally, is planning to eventually phase out sale and production of fossil fuel-powered vehicles.

EVs are also in high demand across parts of Europe, with countries such as France, Norway, Ireland, and the UK following China’s lead by investing in plans of their own to eliminate fossil-fuel powered vehicles.

“Several national governments are encouraging the adaption of EVs by providing various tax incentives and subsidies to the manufacturers and end users,” said GlobalData senior mining analyst Vinneth Bajaja.

“Additionally, efforts to reduce greenhouse gas emissions have led to much technological advancement in EVs and made them a viable and safe alternative to traditional vehicles.”

Norway is the European market leader for EV sales currently (5.4 per cent), followed by Germany (4.8 per cent) and the UK (4.1 per cent). Norway’s feat is particularly impressive given its relatively small population of 5.3 million people.

Australian and Chile are expected to lead in terms of lithium investment to support the expected boom. Australia is currently the world’s largest lithium producer with Chile a close second. In 2016, Argentina overtook China to become the third largest lithium producing country.

Western Australia in particular has an abundance of hard rock lithium mining potential, which is capable of producing very high quality material when compared with the brine method favoured by South American producers.

Companies such as Pilbara Minerals, Altura Mining, Kidman Resources and several other Australian producers should be well-met to meet the demands of the burgeoning EV market over the next five years.