Lithium could easily run into a massive supply crunch – and fast.
In fact, prices could double, if not triple as demand just begins to outweigh supply.
For one, the electric vehicle (EV) could dominate demand for lithium over the next 10 years, reports Reuters, accounting for more than 75% of the metal’s consumption.
In addition, demand for lithium for products such as cell phones and other consumers goods could reach 377,000 tonnes by 2030, as compared to just 242,000 tonnes in 2020. Plus, according to Corporate Knights, “It’s estimated that three billion tonnes of metals will be required to generate clean energy by 2050. One of those key metals – lithium, a light, highly conductive metal – is critical to the construction of battery electric vehicles (BEV). As global automobile manufacturers design hundreds of new BEVs, demand for lithium is expected to triple in the next five years alone.”
However, there’s a problem. There may not be enough supply to meet all of the demand.
According to Reuters, “the electric vehicle industry must pay more for lithium in order to spur investment and prevent future supply crunches of the battery metal, the chief executive of lithium producer Livent Corp said.” He added, “If every EV company took their 2023 plans and went to the lithium market today, they’d probably only get about 15% of their needed supply of lithium.”