Lithium production prospects 2019

Despite the rapid expansion of Li-ion battery production worldwide and parallel expansion of lithium mining, there are several question marks posed for the mid and long-term prospects of this industry. This survey is bringing the updated 2019 analysis of raw Lithium production worldwide, providing supply projections for the mid and long-term trends. It is evident that Li-ion is due to retain its role as the dominant technology for energy storage in the coming years, but critical outlook on global Lithium resources is important in order to prepare for potential disruptions in this market. The recent shifts in production may also contain hints to upcoming Lithium-ion utilization trends and the competitiveness of alternative battery technologies.

Lithium is a metal, which can be found in the form of Lithium salts in various locations across the globe and when in large concentrations – such locations are identified as Lithium resources. Currently, Lithium resources are utilized by a number of end-use industries, including manufacturers of batteries, ceramics & glass, greases, air treatment devices, casting mold powders, polymers and more. The most dominant utilization of Lithium has recently become electrochemical Li-ion cells and with current rapid expansion of battery production, it is assumed that batteries would be an overwhelmingly dominant target market for Lithium resources for at least a couple of decades.

Though there are several variants of the Li-ion technology on the market, the most common one is based on Lithium Cobalt Oxide (LCO) cathode electrodes with Lithium salts as electrolyte and carbon as an anode, which altogether require a considerable amount of Lithium metal per cell. Other Li-ion technologies such as Lithium Manganese Oxide (LMO), Lithium Iron Phosphate (LFP), Lithium Nickel Manganese Cobalt (Li-NMC or simply NMC), Lithium Nickel Cobalt Aluminum Oxide (Li-NCA or simply NCA), Lithium Titanate (LTO) and recently Lithium Sulfur (Li-S) are not principally different in this sense, with some variance of Lithium-containing cathodes and electrolytes coupled with a number of anode types achieving slightly differing power and specific density figures. As such, the growth of the Li-ion industry would require a parallel expansion of mining and processing enterprises – mainly targeted on producing high-grade Lithium carbonate and to a lesser degree on Lithium chlorate and Lithium hydroxide.

Figure 1. Lithium production worldwide (excluding US) 1995-2018 in metric tons, according to USGS data.

According to the US Geological Survey (USGS), the global production of Lithium reached a whopping 85,000 tons annually in 2018. This should be added with the unreported US production, which is likely somewhere around 870 metric tons annually. The production capacity stood at 91,000 tons, adding significant expansion of Lithium mining business worldwide, led by Australia. The global demand for Lithium was estimated at 47,600 metric tons, presenting a strong annual growth over previous year – mostly due to rapid expansion of Li-ion battery production facilities for electric vehicles.

It is not a secret that Lithium has become a crucial component for electrochemical energy storage devices, commonly known as batteries. Li-ion batteries are the unquestionable rulers of energy storage devices in portable electronics and the emerging electric mobility and grid storage. With the developing hunger of battery manufacturers, Lithium production and processing industries are undergoing a rapid expansion. Despite the ramp-up of Li-ion battery production worldwide and parallel expansion of lithium mining, there are several questions posed for the mid and long-term prospects of this industry. While, in the mid-term there are potential technological drivers, capable to raise competition to the Li-ion technology, on the longer term there are also challenges of Lithium supply constraints. Though there are also more acute challenges in acquisition of rare elements such as Cobalt, some Li-ion chemistries do not require it and hence it is not the focus of this research. This survey is bringing you the updated analysis of raw Lithium production worldwide, providing rough estimates for the mid and long-term production trends.

The main question is for how long Lithium production expansion is set to go on before reaching its peak, as Lithium resources in Earth's crust are limited. The latest USGS estimate for available Lithium reserves and resources was 14.0 million and 62.0 million respectively, compared with 16.0 million and 47.0 million metric tons respectively reported previously in 2018. Theoretically, with current production rates, known Lithium reserves would be sufficient to sustain production for almost 200 years, while resources can prove sufficient for almost a thousand years. This is however an over-simplification, disregarding the rapid production growth and dynamic market constraints.

Another question to ask is whether it is possible to have a more realistic estimate for future rates of Lithium production. This can be achieved by a combination of predictive analysis and a fundamental assessment of resources. First of all, the known reserves and resources of Lithium are periodically supplemented with new discoveries. During the past two decades known Lithium resources have increased by more than three-fold and there is a reason to believe this is not the end of Lithium resource discoveries. Nevertheless, Lithium is still an uncommon element and thus there is a slim chance for further three-fold growth from current estimates, unless Lithium prices skyrocket or new technologies for Lithium production from low-concentrated brines are invented.

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