Availability of Lithium

You face a crucial question: does the availability of lithium keep pace with soaring demand for electric vehicles and battery storage? Lithium powers battery groups at the heart of renewable energy technologies and the global clean energy transition. Surging investments and rapid market growth reflect this urgency.

Rising demand for electric vehicles intensifies environmental concerns, making sustainable supply a challenge.

Part 1: Availability of Lithium

1.1 Global Supply

You operate in a market where the availability of lithium shapes your ability to deliver advanced battery packs for electric vehicles and energy storage solutions. Lithium mining forms the backbone of this supply, with two main extraction methods: brine extraction and hard rock mining. Brine extraction dominates in South America, especially in Chile, Bolivia, and Argentina, while hard rock mining leads in Australia. These regions account for the majority of global lithium production.

You see that Australia leads in hard rock lithium mining, while Chile and Argentina focus on brine extraction. Companies like Albemarle and SQM supply over a quarter of the world’s lithium from Chilean brine operations. The Asia-Pacific region, especially China, dominates battery production, driving regional demand and influencing global supply chains.

Resource estimation for lithium mining uses geological surveys for hard rock and brine chemistry analysis for salt flats. However, the lack of standardized global reporting creates discrepancies in reserve projections. You must navigate these uncertainties when planning long-term procurement for battery manufacturing.

The lithium market continues to expand rapidly. In 2025, analysts value the market at over $62 billion, with projections reaching $194 billion by 2032. Major producers invest heavily in new projects and capacity expansions. For example, Albemarle plans to double its Chilean output by 2028, while Rio Tinto and Lithium Americas develop new mines in North America. Despite these efforts, new lithium mining projects face long lead times—often 6 to 10 years—due to regulatory and environmental hurdles.

Note: Over 300 new lithium mining projects must come online by 2035 to meet projected demand, but only a fraction have secured funding or permits.

1.2 Demand Drivers

You witness the growing demand for electric vehicles as the primary force behind the surge in lithium mining. Battery manufacturing for EVs now accounts for the largest share of lithium consumption. The exponential rise in EV adoption since the 2010s, especially in China, has transformed the market landscape. Even during the COVID-19 pandemic, EV sales continued to climb, highlighting the resilience of this sector.

You also see energy storage solutions driving demand for lithium mining. Utilities and grid operators deploy large-scale lithium batteries to stabilize renewable energy sources and balance supply with demand. This trend amplifies the need for reliable lithium supply chains.

The availability of lithium remains a central concern for your business. While current reserves and production can support today’s needs, forecasts show demand could outpace supply by 2030. Battery chemistry innovations and new extraction technologies may help, but you must stay vigilant as the market evolves.

Part 2: Reserves and Extraction

2.1 Major Sources

You rely on a global network of lithium mining operations to secure the raw materials for advanced battery packs. The world holds over 14 million tons of lithium reserves, but only a few countries dominate production. Australia, Chile, and China account for about 90% of global lithium mining. Argentina also plays a key role, especially with its vast brine deposits. The table below highlights the main contributors:

You see that market concentration creates supply risks. Even with abundant reserves, limited geographic distribution and infrastructure bottlenecks can disrupt your battery supply chain. Countries like Mexico, the United States, and the United Kingdom now invest in domestic lithium mining to reduce these risks.

2.2 Extraction Methods

You encounter two main lithium extraction methods: hard rock mining and brine extraction. Hard rock mining involves drilling, blasting, and crushing ore, followed by roasting and refining. This process generates significant land disruption and uses large amounts of energy. Brine extraction pumps mineral-rich water from salt flats into evaporation ponds, where lithium concentrates over months. This method consumes up to 500,000 liters of water per ton of lithium, stressing local water supplies.

You must consider environmental impacts when choosing lithium mining partners. Newer techniques, such as direct lithium extraction, promise lower water use and less land disruption, but remain in early stages. As demand for battery packs grows, you need reliable, sustainable sources to support your operations.

Part 3: Environmental Impact

3.1 Water Use

You face significant environmental impact concerns when sourcing lithium for battery packs. Lithium mining, especially from brine deposits, demands vast water usage. To produce one ton of lithium, you need about 500,000 liters of water. For example, the Thacker Pass project in Nevada plans to extract 60,000 tons of lithium each year, consuming nearly 1.7 billion gallons of water annually. In the Atacama Salt Flat in Chile, about 95% of the brine water used in lithium mining evaporates during extraction. Even though this brine water is not suitable for drinking or farming, its removal disrupts local aquifers and ecosystems. You must consider these environmental challenges, especially in arid regions where water resources are already scarce. Excessive water usage can lead to groundwater contamination and polluting local water sources, creating negative impacts on the environment and local communities.

3.2 Emissions and Pollution

You also need to evaluate the environmental impact of emissions and pollution from lithium mining and refining. Extraction methods vary in their carbon footprint. For instance, direct lithium extraction using diesel generators can emit up to 22 tons of CO2 equivalent per ton of lithium carbonate. Conventional brine evaporation in Chile produces lower emissions but requires extensive land use and high water consumption. The choice of energy source for extraction—diesel, grid electricity, or solar—directly affects emissions. Energy-intensive extraction methods increase pollution concerns and land degradation. As you scale up battery production, you must address these environmental challenges to ensure sustainable growth and minimize the environmental impact of your supply chain.

Part 4: Future Outlook

4.1 Demand Projections

You face a rapidly expanding market for lithium-ion battery packs. The automotive sector drives most of this growth, with electric vehicles leading the way. The following table highlights key market projections:

You see Asia Pacific, especially China and Japan, leading in both production and consumption. North America and Europe also show strong growth, driven by government policies and rising fuel prices. Battery packs for electric vehicles and grid storage remain the fastest-growing applications. You must plan for a market that could quadruple in less than a decade.

4.2 Sustainability Challenges

You encounter several sustainability challenges as you scale up battery pack production:

• Water scarcity in mining regions reduces local farming and impacts communities.

• Studies show global lithium supply faces constraints, especially in high-demand scenarios.

• Research from Salar de Atacama links lithium extraction to water depletion and employment shifts.

• Environmental and social issues, such as land degradation and economic disparity, require careful management.

• Regulatory gaps in some regions make it harder to ensure sustainable and responsible sourcing.

You need to address these challenges to secure long-term supply. Improved recycling, better extraction technologies, and strong regulatory frameworks will help you build a resilient and ethical battery supply chain.

FAQ

1. What factors most affect lithium supply for battery pack manufacturing?

You see supply shaped by mining capacity, extraction technology, and geopolitical stability. Major producers like Australia and Chile set the pace for global battery pack production.

2. How does lithium extraction impact your battery pack sustainability goals?

You must consider water use, emissions, and land disruption. Sustainable extraction methods help you meet environmental targets for your battery pack supply chain.

3. Can lithium recycling fully support future battery pack demand?

You rely on mining for most supply. Recycling supplements but cannot fully replace primary lithium for battery packs.