According to Li Liangbin, the chairman of Ganfeng Lithium, one of the country’s major lithium suppliers, the lithium industry in China is poised to keep increasing over the long term.
Despite recent price fluctuations, the demand for lithium from power battery manufacturers, energy storage companies, and other sectors is expected to grow amid the global energy transition.
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- China’s lithium market is poised for long-term growth amid the global energy transition.
- Stabilizing lithium prices between 80,000-150,000 yuan/ton is crucial for industry profitability.
- Geopolitical factors present challenges but also opportunities for international cooperation.
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China’s Lithium Market: A Bright Future Amid Fluctuations
Stabilizing Lithium Prices: A Win-Win Situation
While some price fluctuations are inevitable, Li believes stabilizing lithium prices between 80,000 and 150,000 yuan ($14,000) per ton would create an optimal environment for the entire industry chain.
Both upstream and downstream companies would remain profitable at this price range, fostering a sustainable and healthy lithium market.
China’s Efforts to Stabilize the Lithium Market
To maintain price stability, China and its companies have implemented various measures.
These include the launch of a lithium carbonate futures trading platform and companies’ utilization of long-term contracts to ensure steady supply and pricing.
Geopolitical Challenges and Opportunities
Geopolitical factors can present entry barriers and investment risks for companies operating in the global lithium market, as Ganfeng Lithium has experienced with its subsidiary in Mexico.
However, Li believes geopolitics can facilitate international cooperation, such as Chinese companies partnering with local firms to establish production facilities.
The Irreversible Trend of Energy Transition
Despite these challenges, the demand for lithium is set to continue its upward trajectory due to the “irreversible trend” of the global energy transition.
As the world shifts towards cleaner energy sources, the need for lithium-ion batteries in electric vehicles, energy storage systems, and other applications will continue to drive the lithium market’s growth.
Ganfeng Lithium’s Global Footprint
Ganfeng Lithium has significant investments in overseas lithium resources, including projects in Australia and Argentina.
The company exports its products to Europe, Japan, and South Korea, demonstrating its global reach and the international demand for lithium.
In conclusion, while the lithium market in China has experienced price fluctuations, the industry’s long-term prospects remain bright.
With the proper measures to stabilize prices and navigate geopolitical challenges, China’s lithium industry is well-positioned to meet the growing demand driven by the global energy transition.
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