The photo is sourced from novoslabs.com
Production increase in absolute terms reached 22.6 thousand tons, 10.7 thousand tons of which were in Chile, 5.7 thousand tons – in Australia, 5 thousand tons – in China, and 1.2 thousand tons – for all the other players. These countries are also the largest lithium producers, with Australia accounting for 46.8% of the global supply, while Chile and China account for 29.8% and 14.6% (with 8.8% for all other countries). At the same time, the global reserves-to-production ratio reached 176: at the current production level, lithium reserves will last 176 years, and separately in Chile – even 239 years.
Production of cobalt and graphite also reached historical highs in 2022, with the volume increase by 20.6% (up to 166.2 thousand tons) and 10.5% (up to 1,391 thousand tons). The Democratic Republic of Congo remains the top cobalt producer with 67% of supply, while China is the key graphite producer (with a global share of 61.1%). Cobalt reserves at the current production rate will last 51 years, and graphite reserves – 256 years.
Oxides of lithium (a soft alkali metal with a silvery white colour) and cobalt (a yellowish transition metal with a pinkish tinge) are used as cathodes of lithium-ion batteries, and graphite (a soft gray-black mineral that is greasy to the touch) as anodes. The cathode is a positively charged electrode, and the anode is a negatively charged one. Accordingly, when charging a battery, lithium ions move from the cathode to the anode through the electrolyte (an electric current conductor), and when discharging, from the anode to the cathode.
The demand for lithium, cobalt and graphite is steadily growing following the development of renewable energy (RES). According to the Energy Institute, the share of renewable energy in the global electricity generation mix in 2022 increased from 12.8% to 14.4% (excluding hydropower plants). The RES weakness is its high weather dependence: for example, in the United States in 2022, the average utilisation of wind generators was 36.1%, and solar panels – 24.8%, according to the Energy Information Administration (EIA). Under these conditions, it is possible to increase energy supply reliability through energy storage systems, investments in the development of which will reach $37 billion in 2023 (against $5 billion in 2018, according to the forecast of the International Energy Agency).
Electric vehicles spread is also a driving demand here. According to the IEA, global sales of battery electric vehicles raised from 1.4 million units in 2018 to 7.3 million in 2022, and their fleet increased from 3.3 million to 18 million units over the same period. Rising demand led to a spike in lithium prices: in South America, the average exchange price of lithium carbonate was $46.8 per ton in 2022 in comparison with $14.7 per ton in 2018.
