Tianqi Lithium to build 30,000-tpy lithium hydroxide project amid global energy transition

Chinese lithium producer Tianqi Lithium plans to establish a battery-grade lithium hydroxide project with capacity of 30,000 tonnes per year in Zhangjiagang, Suzhou in China’s Jiangsu province, the company said on Friday May 12

Construction of the project will take place in two phases, with construction of the first phase estimated at two years.

Total investment for the project is about 3 billion yuan ($431 million). Investment for the first phase of the project will not exceed 2 billion yuan.

Lithium-ion batteries are used to power electric vehicles (EVs), as well as mass energy storage systems and consumer electronics. With the global economy transitioning to green energy and electrification, demand for the metal is forecast to maintain its upward momentum in the years to come.

Lithium-ion battery demand is forecast to exceed 5,000 GWh in 2033, representing a compound annual growth rate of 14% from around 500 GWh in 2022, Fastmarkets battery raw materials analyst Phoebe O’Hara said at the Fastmarkets Asian Battery Raw Materials conference in May.

“Lithium demand should reach 3 million tonnes [per year] of lithium carbonate equivalent [LCE] by 2030, up from 300,000 tpy in 2020,” Daniel Jimenez, partner at iLiMarkets, said during the conference presentation.

In particular, lithium hydroxide is used for the production of nickel-rich nickel cobalt manganese (NCM) batteries that power EVs. Compared with lithium iron phosphate (LFP) batteries, nickel-rich NCM batteries have higher energy density and a more stable performance in lower temperatures.

Tianqi Lithium expects lithium hydroxide demand to rise by 30% per year in the coming years, driven by the growing EV market.

“This year, expect that LFP will be the most popular chemistry in the passenger EV segment,” O’Hara said. “But when grouped, we see that NCM collectively remains dominant throughout the decade.”

Chinese lithium hydroxide prices have been on an uptrend since hitting a 2023 low of 180,000-210,000 yuan per tonne on April 20. The uptrend has been supported by bullish sentiment and strength from the lithium carbonate market, despite limited demand.

Fastmarkets’ price assessment for lithium hydroxide monohydrate, LiOH.H2O 56.5% LiOH min, battery grade, spot price range exw domestic China was 230,000-250,000 yuan per tonne on Thursday May 11, narrowing upward by 10,000 yuan per tonne from 220,000-250,000 yuan per tonne a week earlier.

Visit our dedicated battery materials page to discover more insights on the factors at play in the industry in 2023 and beyond.

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