CHINA WILL BE VERY MUCH SHORT IN LITHIUM, page-8

There’s a lot of noise flying around about China supposedly losing its grip on lithium, but most of it’s based on half-truths or selective data. Yes, lithium demand is heading vertical — global LCE demand is on track to hit ~3.5–4Mt by 2030 (up from ~1.5Mt in 2024). That’s not in dispute. But this whole “China is being shut out” narrative doesn’t really stack up when you look at the actual numbers and supply chain dynamics.

China’s domestic production isn’t disappearingIt’s not just 300kt of LCE as some people are claiming, more like 350 to 400kt if you include lepidolite, Qinghai brines, and some of the new feed from Yichun. Lepidolite’s not cheap to process and carries ESG baggage, but that’s not stopping Chinese players, they’re not pulling back. When you've got central support and vertically integrated capacity, the economics look different.

Refining is still heavily China-dominated, despite all the noise about “de-risking,” China still processes over 65% of global lithium supply, carbonate, hydroxide, the lot. Western investment isfinally picking up (especially here and North America), but refining capacity takes years to build. The restrictions on Chinese investment people keep pointing to? They cut both ways most of those rules hit any foreign player, not just China. Existing JVs and offtakes are still intact.

It’s easy to say China’s being pushed out of Argentina or Africa, but the reality’s more nuanced. CATL, Ganfeng, Tianqi, they still have active positions in projects from Zimbabwe to Salta. Yes, there’s some pushback from local governments, but Western companies face the same political and regulatory headaches (look at what happened to Barrick in Tanzania a few years back), and usually without the downstream muscle to back it up.

Right now, spodumene and carbonate are around ~$8,500/t LCE and that’s putting the brakes on new projects. High-CAPEX hard rock and unconventional brine are being shelved or deferred. Delays in FIDs, environmental approvals, financing they’re all feeding into a likely supply crunch around 2026–27. That’s what will move the price needle again, not some fantasy-fuelled story about China being “cornered.”

China isn’t going anywhere. They’re playing the long game and still control the midstream. The real issue is that the market is underinvesting again just as demand is about to rip. I'm hoping, the next squeeze will be worse than the last, hopefully we can survive until then as no one knows if it's going to be later this year or in 5 years. Would be good if we could stick to data and project economics rather than this Cold War narrative.