Leaders in the industry have issued a warning that there could be a global shortage of Lithium, a crucial element used in both medical and battery products if new mines are not established in time.
The surge in the Electric Vehicle (EV) industry has placed lithium among the most sought-after metals. According to Statista, there has been a 160% increase in global demand for lithium from 2019 to 2023.
However, the supply chain is at risk of being overwhelmed due to staffing shortages and delays in approvals.
Lake Resources, an Australian company listed on Reuters, is the latest lithium company to announce project delays. The company’s Kachi lithium project in Argentina has been postponed by three years.
Stu Crow, the chairman of Lake Resources, expressed concern at the Fastmarkets Lithium and Battery Raw Materials conference in Las Vegas this week. He warned that a crisis could arise if battery companies do not have a secure supply of lithium.
He noted a disconnect between the panic observed at the conference and the frantic efforts within the industry to secure supply.
In 2020, there were 45 operational lithium mines worldwide, with 11 more set to open this year and an additional seven in 2024. However, experts caution that this rate may not be sufficient to meet the rapidly growing demand.
Sales of EVs rose by 60% in 2022, and the total number of electric vehicles produced is expected to exceed 15 million by the end of this year.
Each of these vehicles requires six kilograms of lithium, which makes up about 3.2% of each battery’s mineral mix.
Albermarle, the largest lithium producer globally, anticipates that demand could surpass supply by 2030. This could potentially slow down the rollout of low-emission EVs.
Graphite, another essential mineral used in the production of EV batteries, is also experiencing a global supply shortage.
Tara Berrie of EV manufacturer Rivian emphasized at the Fastmarkets conference that investment must continue to prevent further delays to already lengthy timelines.
