Will America Dominate the Lithium Market In Upcoming Period

The ongoing supply shortages have pushed the Lithium battery-grade pricing trend to the new highs against the soared demand from the downstream Electric Vehicles (EVs) market. It proportionally helped the market players to gain better netbacks as currently, Lithium is utilized as a key metal in the EV batteries. In 2022 alone, the benchmark prices for Lithium doubled in value within the first quarters peaking at a record high in March 2022.

Recently, a major US Lithium player, "Albermarle Corp" revised its forecast for 2022 after exceeding the quarterly profit expectations on robust demand and high competitiveness amongst the buyers to ensure a long-run supply for the Lithium and its derivatives products. That showcased an improved outlook and helped push the company's shares 16% higher in the US stock market as the sales doubled in the quarter on the back of higher prices. The corporation also anticipated that Lithium prices would likely observe the two-fold growth by the end of 2022.

Whereas, several Electric Vehicles producers consider the Lithium shortage a major 'limiting factor' in the growth of Electric Vehicles. Currently, China dominates the Lithium Industry as it has spent over 60 Billion USD to build and facilitate the infrastructural requirement for large-scale Lithium manufacturing over the past decade, and in terms of statistical review, China has 7.9% of the world's Lithium reserves, and the US accounted for 4.0%. Clearly, the US investment lagged in the Lithium industry, and the ongoing competitiveness amongst the players will make it challenging for the US to dominate the market.

Although the US players are consistently working to develop new methods to increase the feasibility of Lithium production, recently, EnergySource and CTR, in collaboration with BHE Renewables, are developing Geothermal-Lithium facilities at the Salton Sea USA. In addition, the Mexican government is also in talks with the Chile, Argentina, and Bolivian authorities to make a Lithium organization in which countries can share their expertise on an individual level to exploit the rare earth mineral.

As per ChemAnalyst, collectively, the Lithium industry needs an investment of USD 43 Billion to meet the 2030 demand. It is also anticipated that with the absence of Russian raw materials, the producers will likely face shortages of several key materials for battery production. In conclusion, it consistently hinders the EV market and persistently supports the producer's quotations of Lithium materials.