Lithium Batteries - Surging Demand and Limited Supply

• The current annual supply of lithium carbonate equivalent is around 650,000 tons, meeting current demand.
• Forecasts predict a five-fold increase in lithium demand by the end of the decade, necessitating 50 additional producing lithium mines.
• Recent shortages in other industries, such as the semiconductor crisis, raise concerns about potential future shortages in the lithium market.
• There is an urgent need for the US and its allies to invest in and advance lithium mine production to meet demand.
• While alternatives to lithium, like zinc manganite, manganese oxide batteries, and organo-silicon electrolyte batteries exist, lithium-ion has taken 40 years to reach its current state, making immediate alternatives less likely.

As a leading developer of lithium projects in the Americas, American Lithium is keenly aware of the surging demand for lithium batteries and the potential for supply shortages. The company is actively engaged in developing large-scale lithium projects in Nevada and Peru, including the TLC Lithium Claystone Project in Nevada and the Falchani Hard-rock Lithium Project in Peru. With robust economics demonstrated in preliminary studies and strong community support, American Lithium is poised to help provide the lithium supply needed to meet rising demand, powering the transition to electric vehicles and consumer electronics. But major investments must continue to avoid a serious supply crunch in the coming decade.

Demand Growing Rapidly

Lithium batteries have become essential components of electric vehicles and consumer electronics. But with demand surging, concerns are growing about whether supply can keep up, according to CEO Simon Clarke in a recent interview with CNBC.

In the interview, Clarke pointed to forecasts of demand for lithium carbonate growing five-fold by the end of this decade. Major agencies like the International Energy Agency estimate the world will need 50 more lithium mines to meet demand. "It just shows you the massive shortage potential that is coming," Clarke said.

Supply Lagging Behind

A key factor driving demand is the transition to electric vehicles. With major automakers planning to go mostly or all electric over the next 10-15 years, lithium batteries will be needed on a massive scale.

Clarke believes new mines can be developed to meet demand, but warns that major investments must happen quickly. "We need the US and all its allies to really take note and start driving these [new mines] forward," he said. "We don't need them coming on in 10 years time."

Lithium Remains Dominant Battery Chemistry

For now, lithium remains the dominant battery chemistry for EV's and electronics. Alternatives like zinc batteries are still a long way off from widespread use, according to Clarke. "Lithium is the third element on the periodic table, it's the lightest metal, it's a perfect conductor," he said. Replicating those properties with a different material is extremely difficult.

While shortages may occur in the short-term, Clarke believes that with the right investments in new mines, the world can build sufficient lithium supply to power the electric future. But key decisions must be made soon to avoid potential crises down the road.