Published February 2014
During 2010–2013, global lithium demand grew by more than 9% annually. The main driver of growth in demand is secondary (rechargeable) batteries for the portable electronics market. Lithium has become the primary type of battery for this market, which includes cell phones, laptop computers, portable entertainment devices and power tools. It is estimated that lithium-ion batteries (LIBs) now account for over 90% of this market, replacing both nickel cadmium (NiCd) and nickel metal hydride (NiMH) batteries.
However, future growth is forecast to be led by the use of LIBs in electric vehicles. This includes battery electric vehicles (EVs), hybrid electric vehicles (HEVs) and plug-in hybrid vehicles (PHEVs). Full EVs have only a battery. HEVs have both an internal combustion engine and a battery-powered electric motor. A PHEV is similar to an HEV in that they both have a gasoline engine and batteries.The largest growth in lithium consumption will occur in EVs and PHEVs. A large number of HEVs are forecast to remain with NiMH batteries for some time.
Batteries in general and rechargeable batteries in particular are the leading market for lithium compounds, and offer the greatest growth potential. Demand for rechargeable lithium batteries continues to gain market share over rechargeable nonlithium batteries for use in cordless tools, portable computers, telephones and video cameras. Major motor vehicle companies are pursuing the development of lithium batteries for EVs.
Governments globally have introduced incentives to buy EVs in an attempt to reduce the initial payment to go green. This has been aided by rising oil prices and subsequent downstream gas/diesel fuel costs, and is forecast to force consumers into a decision on transportation. China has already entered the EV market, while the West is moving in that direction. By 2015, Chinese car brands will be competing with Japanese and Republic of Korea brands in the marketplace. China has low-cost car production, and is preparing for an electric future.
The following pie chart shows world consumption of lithium by end use:
Lithium produced from mineral-based sources is consumed primarily in technical applications, while production from brines is consumed primarily in chemical applications. The leading technical applications include glass, ceramic and metallurgical industries, where its low cost and inherent benefits of having alumina and silica content make it the product of choice. Growing technical markets include use in lighting as a replacement for lead, and use in fiberglass applications, where the superior strength-to-weight ratio of lithium fiberglass is projected to allow a significant increase in the size and resultant power efficiency of wind turbine blades. The chemical market is dominated primarily by use in batteries, lubricant greases, primary aluminum production, air treatment as an absorbent and desiccant, continuous steel casting, initiator in rubber and thermoplastic applications, pharmaceuticals and aluminum-lithium alloys in aerospace applications.
The growth in lithium demand has resulted in the expansion of existing production and development of new lithium deposits globally. Brine deposits are being investigated and developed in Argentina, Bolivia, China and the United States. Mineral deposits are being developed in Australia, Canada, China, Finland and the United States.
The projected growth in battery applications led to continued investigation into lithium resources and reserves during 2010–2013. Capacity is forecast to grow at about 13.5% annually during 2013–2018. It is already known that current producers and those under development will expand capacity to meet demand as needed during 2018–2025.
The primary concern for supply depends on how fast demand for EVs will increase, including full electric vehicles, HEVs, and PHEVs. An average annual growth rate of 15.7% is forecast for EVs between 2013 and 2018. The proportion of EVs with lithium batteries is forecast to grow at an average annual rate of 36% from 2013 to 2018.
It is estimated that current lithium supply is sufficient for projected growth from EVs past 2020. If all the development plans by the proposed new entrants move forward with additional lithium capacity by 2018, there will be a glut of global supply. However, as a result of the lower-grade resources under development, the current pricing of lithium carbonate, the capital costs of developing new projects, and the difficulty in having these new projects running at designed capacity once started, production from development projects is not expected to enter the market as rapidly as some estimates might suggest.
Lithium demand for batteries is projected to grow at 12% annually during 2013–2018, but will increase to 15% annually during 2018–2025. Overall lithium growth is forecast at 5.8% annually during 2013–2018 and 9–10% annually during 2018–2025. Forecasts for 2018–2025 vary considerably depending on penetration of EVs.
This report covers primarily lithium carbonate and lithium hydroxide, with additional data on lithium chloride, lithium bromide, lithium metal, organolithium compounds such as butyllithium, lithium hypochlorite, and the mineral resources lithium chloride brines and hard rock spodumene.