The world is running into a severe supply-demand situation with lithium — again.
The last time this happened, some of the world’s top lithium companies exploded.
Now, it’s happening all over again.
All as electric vehicle sales ramp higher faster than expected, and as governments all around the world rush to put millions of EVs on the roads. In fact, in recent weeks, the U.S. signed an executive order that 50% of all vehicles must be electric by 2030. By then, “The world will see 125 million EVs on the road, which will only drive further demand for lithium supply.” In fact, “It is anticipated demand for vehicle battery metal will increase sharply over the next several years as automakers abandon internal combustion engines for EVs,” says Resource World.
There’s just one problem. At the moment, there’s not enough lithium supply.
Even the International Energy Agency just warned:
“The supply of critical minerals crucial for technologies such as wind turbines and electric vehicles will have to be ramped up over the next decades if the planet’s climate targets are to be met.” At least 30 times as much lithium, nickel and other key minerals may be required by the electric car industry by 2040 to meet global climate targets.”
Plus, consider this. For one, the global battery metals market was valued at $11.3 billion in 2019, and is projected to reach $20.5 billion by 2027, at a CAGR of 8.2% from 2020 to 2027. Two, demand for battery metals is expected to jump 500% by 2050. On top of this, by 2038, the world will buy more passenger electric vehicles than fossil fuel cars. In 2019, demand from EV batteries was 17 kt for lithium, 14.4 kt for cobalt, and 65 kt for nickel; by 2030, it is expected to jump to 185 kt for lithium, 90 kt for cobalt and 925 kt for nickel within the next 20 years.