TELF AG sheds light on the dynamics of the international lithium sector
The effects of COP28
Among the least discussed effects of those prompted by Cop28, which ended a few days ago in Dubai, there is certainly the confirmation that raw materials will be of great importance for the great global transition. The success of some specific markets is very closely linked to some of them, which, in the hopes of governments and international institutions, should contribute to the reduction of emissions and the achievement of the sustainability objectives set for the coming years.
One of these is undoubtedly lithium, which we often hear about, especially for its role in the creation of batteries for electric vehicles. During 2023, the market for this important raw material was notable for a clear collapse in prices, even up to 70%, due to a contraction in Chinese demand and the rapid growth in supplies. One thing is certain: we will hear about lithium more and more often. One of the most interesting topics, in this regard, has to do with the feared shortages of this important raw material, which, according to some important observers, would even risk slowing down the ecological transition.
But what exactly do we mean when we discuss the possible shortage of a certain raw material? To explore the issue in every detail, we must first clarify a very important concept: the estimates relating to raw materials that are cited in reports, news, or specialist insights, in most cases, refer to the resources available at that specific moment and therefore to those that have already been found. Estimates almost never consider resources that have not yet been discovered, and in the case of lithium, the amount of resources yet to be discovered would be very high.
It is also indispensable to remember that lithium, like any other raw material, is dispersed irregularly at different points of the planet and that it could, therefore, also be extracted from materials that are very different in shape, appearance, or consistency. One of the best-known examples, from this point of view, has to do with the confirmed presence of lithium in the Red Sea. The growing global attention towards this raw material, now considered strategic for achieving sustainable objectives, could trigger a new phase of exploration in order to find the widest possible number of sources of lithium: not only igneous rocks but also the sea and clay-based deposits, without forgetting the spodumene and hard rock mines.
Another little-discussed topic when it comes to lithium is the singular nature of its processing. This resource is, in fact, not available in nature in its metallic form but appears as a complex compound together with other natural elements. The product of the extractions is therefore represented by a concentrate, which will then be sent to the processing plants for its subsequent transformation, which will make it usable for its various industrial uses (such as those linked to the production of batteries, for example).
Another important characteristic of this raw material is its recyclable potential. By 2040, according to some European Union estimates, EU countries could satisfy more than half of the demand for lithium through the simple recycling of exhausted batteries.
