Pittsburgh — Global lithium demand is expected to more than double by 2024 as electric vehicle battery production quadruples, analytics consultant GlobalData said Oct. 7.
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Lithium demand is expected to rise to 117,400 mt in 2024 from an estimated 47,300 mt in 2020 at a 25.5% compound annual growth rate, GlobalData said in a report.
Vinneth Bajaj, a senior mining analyst for GlobalData, said the increased demand will spur a corresponding surge in lithium production by 2024.
"Lithium metal production is expected to reach 134,700 mt versus 58,800 mt in 2020," Bajaj said. "This follows a significant 18.2% decline in 2019 to 78,200 mt, resulting from sluggish global EV sales and a steep fall in prices, which, in turn, encouraged reduced production levels."
Bajaj said lithium supply in 2024 will still mainly be supported by operations in Australia, Chile and Argentina.
The growth in the lithium market will correlate with greater electric vehicle production, GlobalData said, adding that annual EV output will climb to 12.7 million units in 2024 from 3.4 million units in 2020.
Bajaj said China will lead global lithium demand with rising battery manufacturing capacity and EV sales.
"China is determined to boost EV sales, targeting a 20% share of the new car sales by 2025, versus just 5% in 2019," Bajaj said. "The country's decision to cut subsidies in a phased manner until 2022, rather than eliminating it in 2020, is expected to provide an essential boost to the domestic market, as well as the overall global EV market."
Despite market disruptions in the automotive industry caused by the coronavirus pandemic, S&P Global Market Intelligence said it forecast global plug-in EV sales to decline by only 3% in 2020 to 2.15 million units, boosted by strong sales in Europe.
"Passenger PEV registrations in the European Union in the first seven months surged by 99% year over year to 387,000 units, amid a 33% decline in overall passenger vehicle registrations," Market Intelligence analysts said in their September lithium report.
The analysts said companies such as Albemarle are advancing key lithium projects to prepare supply in an effort to meet medium-to-long-term demand growth.
"Albemarle has begun a recruitment campaign for 300 operational staff at the Kemerton lithium hydroxide plant in Australia, which is targeting commissioning in 2021," Market Intelligence said. "The company is relying on the spodumene route to meet lithium hydroxide demand, while the Salar de Atacama operation in Chile will drive increases in the company's lithium carbonate capacity."