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30 Aug, 2023 05:31

World faces shortage of key metal – CNBC

Demand is increasing for lithium, particularly from China, the media outlet reports
World faces shortage of key metal – CNBC

The global supply of lithium, which is used to make batteries for consumer electronics and electric vehicles, is expected to fall short of demand as early as 2025, CNBC reported on Tuesday, citing Fitch Solutions research unit BMI. 

Analysts predominantly attribute the potential shortage to lithium demand in China, which currently exceeds the country’s available supplies. 

“We expect an average of 20.4% year-on-year annual growth for China’s lithium demand for EVs [electric vehicles] alone over 2023-2032,” BMI said in its latest report, adding that lithium supply in the world’s second-biggest economy would only grow by 6% over the same period. 

China is ranked as the world’s third-biggest producer of lithium, which is vital for producing batteries for electric vehicles.   

Global production of lithium reportedly totaled 540,000 metric tons in 2021, while the World Economic Forum expects global demand to amount to more than 3 million metric tons. 

Global sales of electric cars are projected to reach 13.8 million this year, but will subsequently skyrocket to more than 30 million units by 2030, according to forecasts by S&P Global Commodity Insights. 

“We do fundamentally believe in a shortage for the lithium industry. We forecast supply growth of course, but demand is set to grow at a much faster pace,” Corinne Blanchard, Deutsche Bank’s director of lithium and clean tech equity research, told CNBC. 

The expert sees a “modest deficit” of around 40,000 to 60,000 tons of lithium carbonate equivalent by the end of next year, but expects a wider deficit amounting to 768,000 tons by the end of 2030.

For more stories on economy & finance visit RT's business section

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