China Lithium Market Research Report, 2030

China has been the single largest consumer of lithium-ion (or li-ion) batteries for five consecutive years. It is also the world’s undisputed king of battery production, with China’s largest battery manufacturer Contemporary Amperex Technology Co. (CATL) alone holding around 35 % of the global li-ion battery market in the first quarter of 2022. In the field of solar battery modules, Chinese companies hold around 71 % global market share. To promptly address these issues, China’s Ministry of Industry and Information Technology (MIIT) and State Administration of Market Regulation (SAMR) released a notice with a range of suggestions for improving the domestic li-ion market. These range from increasing capacity in fields that are lacking to improving quality control supervision to encouraging collaboration between industry players. China has a wealth of natural resources, including many of the raw materials needed for the production of li-ion batteries, such as lithium, cobalt, and nickel. However, in many cases, China’s strength in these industries lies not in the number of resources and scale of extraction, but in its processing and refining capabilities. Reliance on imports makes China’s battery industry vulnerable to price fluctuations of raw materials, and due to the high demand and production shortfall, prices of certain materials are sky-high. On November 10, 2022, the MIIT and the SAMR released a notice on achieving coordinated and stable development of the lithium-ion battery industry supply chain. The notice is not a concrete policy document, but rather a call to various government departments and industry groups to take measures to address the issues discussed above. To ensure stable development of supply and demand, the notice calls on government departments to promote communication and collaboration between upstream and downstream companies in the li-ion battery industry. According to the research report "China Lithium Market Research Report, 2030," published by Actual Market Research, the China Lithium market is anticipated to grow at more than 17.43% CAGR from 2025 to 2030. Local industry and information technology authorities and market supervision departments guide lithium battery enterprises to carry out technological innovation, strengthen quality control, optimize process flows, obtain quality certification, and improve testing capabilities of li-ion battery products. To ensure the consistent quality required for battery manufacturing, significant advancements are being made in advanced crystallization and precipitation techniques, allowing for precise control over the particle size, shape, and purity of lithium carbonate and hydroxide, impacting battery performance and processability. The application of advanced materials and membranes in separation and purification is also a key focus, with the development of novel selective membranes and sorbents aimed at enhancing lithium recovery rates and reducing the use of harsh chemicals in brine processing. Given the water-intensive nature of brine extraction, a considerable amount of Chinese RD is directed towards reducing water consumption in brine extraction, including the optimization of evaporation pond management and the development and implementation of Direct Lithium Extraction (DLE) technologies tailored to the specific characteristics of Chinese brine resources. Hydrometallurgical recycling is a major focus, with continuous innovations in leaching agents, solvent extraction systems, and precipitation methods to achieve high recovery rates of lithium, cobalt, nickel, and manganese from spent batteries. Pyrometallurgical recycling, involving high-temperature smelting, is also being advanced to recover valuable metals, including lithium in some processes, often integrated with hydrometallurgical steps for comprehensive material recovery. The sustainability focus extends to the sourcing and management of reagents used in extraction and processing, with efforts to identify and utilize more environmentally benign alternatives and develop methods for reagent regeneration and recycling. Recognizing the potential economic and environmental benefits, Chinese researchers are also heavily engaged in research into methods for utilizing byproducts and waste streams from lithium extraction and processing, exploring potential applications for minerals and materials present in these streams.

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China's lithium market exhibits a robust and multifaceted consumption of various lithium compounds, directly mirroring its dominant position in the global battery and electric vehicle supply chains. Lithium carbonate (Li2CO3) serves as a foundational pillar, acting as a crucial precursor for the production of lithium hydroxide and a significant component in the manufacturing of Lithium Iron Phosphate (LFP) cathodes, a battery chemistry experiencing substantial growth in China's EV and energy storage sectors due to its cost-effectiveness and safety. Lithium hydroxide (LiOH) is equally vital, driven by the extensive production of high-nickel content cathode materials like NMC and NCA, favored for their higher energy density in mid-to-high-end electric vehicles manufactured in China for both domestic and international markets. The ongoing advancements in EV technology and the increasing demand for longer-range vehicles further solidify the importance of lithium hydroxide. Lithium chloride (LiCl), while not as voluminous in battery cathode production, plays a critical role as the primary feedstock for the production of lithium metal, which finds applications in specialized primary batteries and as an alloying agent in certain industrial processes within China. The category of other lithium compounds encompasses a diverse range with specialized applications. Lithium metal itself, beyond its precursor role, is used in niche battery applications and in metallurgical processes. Organolithium reagents, such as butyllithium, are indispensable in China's thriving chemical synthesis industries, particularly in the production of pharmaceuticals, polymers, and other advanced materials. China's lithium market is intricately linked to its dominant position in the global battery and electric vehicle (EV) supply chains, with its sourcing strategy reflecting this prominence. While China possesses significant domestic lithium reserves, particularly in brine lakes on the Qinghai-Tibetan Plateau and spodumene deposits in Sichuan and Xinjiang, it historically hasn't relied solely on these. A substantial portion of China's lithium feedstock has been secured through strategic investments and off take agreements with hard rock mines, primarily in Australia, which has been a key and reliable supplier. Domestic brine resources are increasingly being exploited, with advancements in Direct Lithium Extraction (DLE) technologies aimed at improving efficiency and reducing the environmental impact associated with the high magnesium-to-lithium ratios prevalent in many Chinese salt lakes. The government is actively pushing for increased domestic brine production to reduce reliance on imports and secure its supply chain. The recycled lithium sector in China is rapidly evolving, driven by the massive growth in EV adoption and the resulting volume of end-of-life batteries. China has become a global leader in battery recycling technologies and capacity, with numerous companies employing both hydrometallurgical and pyrometallurgical methods to recover lithium and other valuable battery materials. This segment is crucial for creating a circular economy, reducing dependence on primary mining, and mitigating the environmental footprint of the battery industry. China's lithium market has evolved to strategically leverage a combination of sources. While it has access to domestic hard rock and brine resources, its growth was initially heavily reliant on imported spodumene. With advancements in DLE for its unique brines and a rapidly expanding recycling infrastructure, China is striving for greater self-sufficiency and a more sustainable lithium supply chain to maintain its global dominance in the battery and EV sectors. China's lithium market, the world's largest consumer, is overwhelmingly dominated by the Automotive (Electric Vehicles) sector. The nation's aggressive push for EV adoption, driven by stringent government mandates, substantial subsidies, and a large domestic automotive industry, has created an insatiable demand for lithium-ion batteries. This sector accounts for the vast majority of lithium consumption, with a focus on both high-nickel chemistries for longer-range vehicles and the rapidly growing market for Lithium Iron Phosphate (LFP) batteries, favored for their cost-effectiveness and safety. The Consumer Electronics industry in China also represents a significant, albeit more mature, end-use for lithium-ion batteries powering smartphones, laptops, tablets, and wearables. The immense domestic production and consumption of these devices contribute substantially to the overall lithium demand, though its growth rate is less explosive than the EV sector. The Industrial sector utilizes lithium in various specialized applications, including high-performance lubricants crucial for China's vast manufacturing base, as well as in certain metallurgical and chemical processes. China's ambitious renewable energy targets and its commitment to grid modernization are driving significant deployment of lithium-ion batteries for grid-scale and residential energy storage. This sector is experiencing rapid growth and is becoming a crucial secondary driver of lithium demand after the automotive industry. The automotive sector is the undisputed primary end-use for lithium in China, dwarfing other applications in terms of volume and growth. The burgeoning energy storage sector is a strong secondary driver, while consumer electronics and industrial uses provide a consistent baseline demand.

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Nikita Jabrela

Business Development Manager

Considered in this report • Historic Year: 2019 • Base year: 2024 • Estimated year: 2025 • Forecast year: 2030 Aspects covered in this report • Lithium Market with its value and forecast along with its segments • Various drivers and challenges • On-going trends and developments • Top profiled companies • Strategic recommendation By Product • Lithium Carbonate • Lithium Hydroxide • Lithium Chloride • Other Lithium Compounds (lithium metal, butyl lithium, etc.)

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By Source • Hard Rock (Spodumene) • Brine • Recycled Lithium By End-Use Industry • Automotive (Electric Vehicles) • Consumer Electronics • Industrial • Others (Energy Storage Systems etc.) The approach of the report: This report consists of a combined approach of primary as well as secondary research. Initially, secondary research was used to get an understanding of the market and listing out the companies that are present in the market. The secondary research consists of third-party sources such as press releases, annual report of companies, analyzing the government generated reports and databases. After gathering the data from secondary sources primary research was conducted by making telephonic interviews with the leading players about how the market is functioning and then conducted trade calls with dealers and distributors of the market. Post this we have started doing primary calls to consumers by equally segmenting consumers in regional aspects, tier aspects, age group, and gender. Once we have primary data with us we have started verifying the details obtained from secondary sources. Intended audience This report can be useful to industry consultants, manufacturers, suppliers, associations & organizations related to agriculture industry, government bodies and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.