The year of 2018 is seeing the increasingly deepened reform of upstream lithium business in China. The enterprises in possession of lithium ores gradually showcase their competitiveness. 

  

The global lithium demand has been more than 18 million metro tonnes in the year 2015. Almost half of the demand is driven by battery production. Several estimates projected global lithium demand to reach more than 500 million metro tonnes by 2025. 

The major producing and supplying countries of lithium are Australia, Chile, Argentina as well as China. These four countries also have the largest lithium reserves, able to supply the worldwide demand.

Currently, viable recycling processes are capable to recover many metals, but they are not able to directly recover vital lithium. Much more development is needed to improve the effective recycling processes. Hence, Lithium upstream products are and will be highly demanded in China and the world markets during the next decade.

China has abundant lithium resources with reserves among the highest in the world. The resources mainly include spodumene, lepidolite and salt lake lithium, 80% of which are salt lake brine. Salt lake lithium is mainly located in salt lakes of Qinghai and Tibet. Spodumene is mainly located in Ganzi Tibetan Autonomous Prefecture and Aba Tibetan Autonomous Prefecture.

Lake Zabuye is a landlocked salt lake located in Tibet Autonomous Region, 1,050 km away from Lhasa. The lake is surrounded by mountains. It is fed by rain, underground water and melting ice. The lake gives its name to the mineral zabuyelite, a lithium carbonate, which was discovered in 1987 and has been mined since 2004. In 2008, the salt mine at the lake was regarded as the major source of lithium in China. Currently, Zhabuye Lithium owns 20-year exclusive mining rights for the Zhabuye salt lake.

Currently, the rapid development of power Li-ion battery is driving the deepened reform of the upstream lithium business in China. According to market intelligence firm CCM, bigger differences are seen between leading enterprises and disadvantaged enterprises. Newcomers in the market are increasing significantly, competition for the limited resources is growing fiercer, capacity expansion is rising, and demand for premium marketed lithium products is shifting from battery grade lithium carbonate to battery grade lithium hydroxide.

In this context, the upstream lithium business is advantaged. In the world, the supply of lithium resources mainly come from spodumene ore and salt lake, both expected to continue playing a dominant role in the market, due to the limited recycling possibilities. This has attracted many domestic leading lithium suppliers to go abroad for quality resources.

Now Tianqi Lithium and Ganfeng Lithium which run their quality lithium business in foreign countries, stand firm as leaders. Their production capacities are far larger than the competition. Following them, Shandong RuiFu Lithium is reliant on importing lithium ore from other countries, Sichuan Yahua purchases spodumene concentrate from Tianqi Lithium and JSMC in possession of lepidolite ore increases its capital in Australian Tawana.

So far, a total of 3 lithium resource development centres have been established in China, though the domestic exploitation of lithium resources is slow. They are Qinghai salt lake, Sichuan spodumene ore and Jiangxi lepidolite ore, based on which some enterprises are expanding their production capacity.

It is notable that a succession of breakthroughs has been made in lithium extraction technologies such as lithium extraction from salt lake and recovery of lithium from ore, given the accelerated exploitation of domestic lithium resources. Zangge Holding announced its success in the experimentation of technology to extract lithium from Li-ion enriched materials and brine

In addition, the increasing scrapping of power Li-ion battery makes it possible for lithium salt enterprises to recycle raw materials and to extract and purify lithium carbonate. Ganfeng Lithium built a lithium iron phosphate recycling line with the output of about 1,000 tonnes per year in 2017 and will construct a ternary materials recycling line in 2018. Jiangxi Hezong Lithium Technology Co., Ltd. has partnered with battery recycling and processing enterprises since 2016, a move to purchase their crude lithium carbonate to produce lithium chloride solution after dissolution and primary edulcoration and to get battery grade lithium carbonate finally.

About the top enterprises

Tianqi Lithium is a leading global supplier of lithium products, dealing mostly with lithium resource development and exploitation, downstream production processing and trade for a diverse range of high-quality lithium products including mineral concentrates. The company has established global presences in China, Hong Kong, Australia and Chile.

 

Ganfeng Lithium is one of the world’s leading Lithium manufacturers, established in China in 2000. Ganfeng has experienced rapid growth in recent years, consequently forming several highly specialized Lithium production subsidiaries and most recently commissioning a new facility in China. The company exports and produces over 20 lithium products for various applications worldwide.

 

About the article

The information for this article comes to form CCM, China’s leading market intelligence provider for the fields of agriculture, chemicals, food and feed.

 

For regularly insights in China’s lithium market, take a look at CCM’s monthly published China Lithium Newsletter, with insights in market trends, company development, policy changes, import and export data, as well as any newsworthy story. 

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