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- Lithium hydroxide could be in shortage by 2025
- Market needs to plan for new capacity today
For more high-performance electric vehicle batteries, the market needs to plan for more lithium hydroxide today. There could be a shortfall of the chemical compound by 2027, as demand for high-nickel chemistries surges. The market is just in time to plan for new capacity today, since it takes about 5 years to bring a plant online.
Some 35% of the projected supply growth until 2025 will come from high-risk spodumene-to-hydroxide converters in Australia. If these converters are delayed, the market could face a shortage by 2025. Albemarle’s Kemerton project will be the first of these converters to commission this year. The integrated model has not been economically proven and could face potential delays and complications during ramp up.
Beyond Albemarle’s plant, seven new hydroxide plants in China, with 145,000t LCE net nameplate capacity, will come online this year. Orocobre/Galaxy’s new Naraha plant in Japan will test a new supply chain structure, as companies seek to diversify, capture more value and depend less on China.
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