Some leaders, such as Carlos Tavares, the boss of the Stellantis group, not to mention himself, have already warned of future problems with the supply of raw materials in the coming years. Elon Musk also said that he is very concerned about the speed with which the energy transition begins in the automotive industry.

Lithium producers are also concerned. The latter do not get enough permits to open new mines (or get them very late), do not find enough labor and fear inflation with the inevitable rise in prices, which will also lead to higher prices for cars.

However, lithium producers today have a real golden goose. Before the appearance of the electric car, lithium was a niche material, its quantity was relatively small. In recent years, demand has increased dramatically, and manufacturers have had to respond urgently.

Demand is growing too fast

The current situation is relatively simple: demand for lithium is growing, electric cars continue to develop, and, according to analysts, a crisis is already on the horizon. “The problem is that battery manufacturers do not have security of supply of raw materials, especially for lithium”– Stu Crowe, director of the Lake Resources company, which works in the field of raw materials related to the production of batteries for electric cars, told Reuters.

Albemarle, the largest lithium producer to date, fears it will not be able to meet demand. The American giant is increasing production in several regions of the world, but it is difficult to keep up with the growth in demand. which will increase from 130,000 tonnes produced in 2022 to 500,000 tonnes by the end of the decade.

The problem of quantity and quality

Last year, there were 45 lithium mines operating worldwide. In 2023, 11 mines will be commissioned, and in 2024 – seven more. Several fields have been discovered in Europe, in particular in France, but it will be several years before they are put into operation.

But mining is just one problem out of many. Even if “raw” lithium is available, it will need to be processed to produce materials that can be used in industry. This is the second problem that needs to be solved. There is even a third village quality factor. As demand increases, some producers will be forced to accept lower quality lithium.

But beyond these initial problems, everyone wants their piece of the pie. To give you an idea of ​​the interest in lithium, it is enough to quote the numbers from the last Fastmarkets conference in Las Vegas, which in particular summarized the white gold market.

This year, 1,100 industry professionals visited, which is 68% more than in 2022. Also present were representatives of Exxon Mobil, Equinor and other oil companies that are increasingly diversifying their businesses to reduce their dependence on oil.

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