SHANGHAI, Mar 2 (SMM) – Australian lithium miner Core Lithium (CXOXF.US) announced on Wednesday that it signed a supply agreement with Tesla (TSLA.US) to supply Tesla with up to 110,000 mt of spodumene concentrate in four years.

Core Lithium stock closed more than 16% higher on Tuesday boosted by this news.

Core Lithium states that the spodumene concentrate it will supply to Tesla comes from its flagship Finniss Project in the Northern Territory of Australia. The supply is expected to begin in the second half of 2023.

The supply agreement reflects a surge in demand for battery metals such as lithium, nickel and cobalt as the world embraces a more sustainable future with exponential growth in electric vehicle sales.

In addition to Core Lithium, Australian lithium miner Liontown Resources and graphite supplier Syrah Resources have both struck similar deals with Tesla over the past few months.

Global automakers are racing to secure the supply of automobile parts used to make electric vehicles.