The parties also agreed to cooperate on identifying further opportunities to invest in the country’s lithium sector.

Argentina is nestled in the “lithium triangle,” alongside Bolivia and Chile, where more than 70% of the world’s lithium reserves lie beneath its salt flats.

The current Argentinian administration under President Alberto Fernández is committed to developing the country's lithium resources.

Argentina’s government announced in early April that it had set up the “Mesa Nacional del Litio” roundtable in collaboration with the nation’s lithium-rich provincial governments of Jujuy, Catamarca and Salta. The roundtable is tasked with the development of lithium exploitation and its industrialization.

“We are working in Argentina on various projects and we are supporting Argentina's industrial development to allow the country to be one of the key global lithium producers. We are committed to working alongside Argentina on the sustainable development of the industry,” Ganfeng Lithium chairman Li Liangbing said.

“Argentina has an enormous geological potential, which is being explored jointly by both countries. This will allow us to position ourselves to the changes that will take place over the next decade,” Argentina mining secretary Albert Hensel said.

“[I believe that] 80% of lithium production will be destined to electromobility, and this agreement will allow us to satisfy this demand," he said.

Ganfeng Lithium partnered with junior miner Lithium Americas for the development of the Caucharí-Olaroz lithium brine project in Argentina.

The project is on track to start production in mid-2022, which once operational is expected to produce 40,000 tonnes per year of battery-grade lithium carbonate equivalent. 

Ganfeng Lithium owns a 51% stake in the mine and Lithium Americas the remaining 49%.

Lithium prices have surged globally since the beginning of the year due to tightness in supply.

The persistence of this tightness has supported lithium prices in the seaborne Asian market, a key consuming region of the ultralight metal.

Fastmarkets’ assessment of the lithium hydroxide monohydrate, 56.5% LiOH.H2O min, battery grade, spot price, cif China, Japan & Korea was at $12.50-14 per kg on May 13, up by 1.92% from $12.50-13.50 per kg one week earlier.