....BYD and CATL have been moving big into South America to secure their long term lithium supplies at preferential pricing.
....these state sponsored lithium projects in SA view them as foreign exchange earners in deals with the Chinese to invest and provide the technology.
....notably both CATL (which secured the Bolivian lithium project) and BYD controls 52% of the EV battery market worldwide.
....there were also reports earlier in the year that BYD was looking to acquire or enter into a JV with Sigma Lithium (SA), I believe the Chinese battery makers would have contemplated acquiring Australian lithium assets if they were allowed to.
....South America welcomes Chinese investments as do African countries, enabling them to lock in their supplies without undue concerns over geopolitical pressures to cut off supplies.
....if 52% of the world's EV battery makers lithium needs are satisfied largely from SA and Africa state sponsored mines, there would be little to no pressure on the demand in the spot market, ensuring that lithium prices remain stable in lower ranges possibly over the coming decade.
....Tesla which commands a commanding EV market share is also relying on cheaper battery costs to make its Tesla models able to keep up with the Chinese aggresive inroads- and will be very happy if lithium prices remain as low as they are; its close Chinese connection would suggest to us that the industry sees a stable and reasonable critical minerals market as being crucial to their long term success if EV penetration is to reach a meaningful mass adoption in the years ahead.
...Hence, the success of EVs is not necessarily the success of the lithium space. The lithium industry needs to survive at a more stable and reasonable price and they can focus on lifting production as EV adoption ramps up, but any success of the lithium industry as defined by significantly higher prices would be to the detriment of the EV industry which it feeds and depends. BYD takes next steps on $290 million lithium project in Chile
Chinese electric-car juggernaut BYD Co. is deploying an engineering team as part of a project to start processing lithium in Chile, home to the world’s biggest reserves of the metal that’s a key component in EV batteries.
The move is part of plans by BYD, already the world’s second-largest battery maker, to build a $290 million lithium cathode factory in northern Chile. Most of the company’s processing has been concentrated in China, so moving into the South American country will allow it more strategic access to the lithium reserves.
BYD in April was granted access to preferential prices for lithium carbonate in the country. The Chilean government awarded the special status specifically because of the plans to build the plant, which is set to begin making lithium iron phosphate for cathodes by the end of 2025.
“Now we are sending the engineering team to do the feasibility study and to choose the site,” executive vice president Stella Li said in an interview from Bloomberg’s offices in Sao Paulo.
Makers of EVs and rechargeable batteries are reaping the benefits of surging demand in the shift away from fossil fuels. But they’re also facing tight markets for raw materials. In a bid to lock in future supplies, they’ve started to fund more mining and processing projects.
In Chile, BYD is completing final contracts for its project at a time when the country’s government is adopting a new model for lithium extraction that will give the state a stake in new endeavors. At the same time, the government is stepping up efforts to encourage downstream investments.
BYD is willing to work with Chilean authorities, including offering its technology to the government, Li said.
Thanks to being granted the status of specialized lithium producer, BYD will be able to access preferential prices for 11,244 metric tons a year of battery-grade lithium carbonate until 2030 from Chile’s SQM, the world’s No. 2 lithium producer.
