Tees Valley Lithium's Lithium Sulphate Refinery under Construction in Australia

A number of global lithium companies are seeking to extract lithium metal on site in Australia, the world's largest producer of lithium whose output accounts for half of the global total, with the aim to reduce transport costs and create new supply chain. In Australia, the lithium metal is usually contained in spodumene (6% grade). These raw ores will be shipped to China for extraction and turn into lithium sulphate before being processed into lithium hydroxide as battery cathode materials.

It is learned that UK lithium company Tees Valley Lithium is investing in a lithium sulphate refining facility in Australia, a move that is expected to reduce shipment volume of lithium-related materials by around 75-80%t. Ross Gregory, partner at Australian consultancy New Electric Partners, said that for Australian mining companies, establishing downstream processing facilities such as lithium sulphate collection and distribution centre while sharing the costs, would help improve efficiency across the supply chain.

As the global automotive industry transitions to electrification, battery metals such as lithium, nickel and cobalt are becoming increasingly important. The lithium market, for example, is still in short supply and is likely to face further shortages in the future. Demand for lithium carbonate is expected to reach 910,000 mt this year in contrast to the supply of 900,000 mt. Benchmark Mineral Intelligence estimates that the annual demand for lithium carbonate will be as high as around 2.7 million mt by 2030, leaving the supply deficit at 300,000 mt.