Automakers Will Increasingly Look To Partner Lithium Producers
BMI View : Although the growth in global lithium production has stagnated in the face of a well supplied market, we believe growing demand for li-ion batteries from the automotive and energy storage industry will create a surge in lithium demand in the coming years. While brine producers enjoy a cost advantage, most of these deposits are located in politically volatile regions, which we believe, will push more automakers to enter into partnerships with lithium producers to secure supplies of the raw material.
In this piece, we highlight the emerging opportunities within the lithium industry amid our expectation for a surge in demand for the metal in the coming years. The key driver of this will be the greater usage of this metal in the automotive industry, as well as the smart grid and energy storage industry, for the production of batteries.
At present, demand for batteries makes up about 29% of global lithium demand, according to the United States Geological Survey (USGS). With lithium being a key material required in the manufacturing of lithium-ion (li-ion) batteries, we expect demand from battery makers to grow significantly as sales of hybrid and electric vehicles (EVs) rise in the coming years, albeit from a low base.
|Battery Production Will Be Key Driver|
|Lithium Use By Application|