The North American lithium market is in need of local production and refinement capability
\nGlobal demand is forecast to triple by 2030
\nJunior stock Lithium Universe plans to build a 16,000tpa lithium refinery in Quebec to bridge the downstream supply chain gap<\/p>\n
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North American market\u2019s insatiable appetite for locally produced lithium products could be a boon for Canada\u2019s emerging lithium downstream supply chain.<\/strong><\/p>\n Development of a lithium industry is accelerating at pace in Canada, with two mines in production and a bunch on the way \u2013 yet refining capabilities still need to catch up.<\/p>\n OEMs are setting up shop in places like Quebec and Ontario with billion-dollar battery manufacturing plants yet there\u2019s a current lack of ability to refine the raw materials locally.<\/p>\n Car manufacturers such as Stellantis, Ford, Honda and General Motors, as well as battery makers LG Energy Solution, POSCO and Lion Electric Co are all looking to feed into the North American market.<\/p>\n \u00a0<\/p>\n Despite currently deprssed prices global demand for Li-ion batteries is projected to rocket up to 2030, according to McKinsey<\/a>, increasing from 700GWh in 2022 to 4.7TWh by the end of the decade.<\/p>\n \u00a0<\/p>\n Source: McKinsey.<\/p>\n \u00a0<\/p>\n The Atlantic Council<\/em> says the US in particular desperately needs to hasten the development of supply chains for critical minerals and especially lithium to end its reliance on China.<\/p>\n \u201cThe US has a lithium problem. More precisely, US demand for lithium is growing exponentially while access to secure supplies is becoming more tenuous,\u201d it writes.<\/p>\n \u201cA better solution is to develop new supply chains that don\u2019t depend on China or Chinese companies for critical minerals, including lithium.\u201d<\/p>\n Lucky for them, Canada is right next door and while its lithium production and downstream processing abilities are still emerging \u2013 the country is incentivising exploration and development with a multi-billion-dollar critical minerals strategy<\/a>.<\/p>\n Lithium Universe (ASX:LU7)<\/strong><\/a> non-exec directors Patrick Scallan and Jingyuan Liu spoke to Stockhead<\/em> about how companies like theirs can take advantage of the nascent ex-China supply chain.<\/p>\n \u00a0<\/p>\n Scallen says the lithium mining sector has gone through major changes over the decades and it\u2019s now all about volumes, processing and refinement \u2013 something that China recognised early doors, while the West is seen to have been caught with its pants down.<\/p>\n \u201cWhen we were mining 30 years ago we used the mineral as an ingredient for glass and ceramic manufacture,\u201d Scallan says.<\/p>\n \u201cNow it\u2019s just about all converted into lithium hydroxide or lithium carbonate and then used as an ingredient in various applications.<\/p>\n Moving forward to today and Scallen notes that current trends don\u2019t seem to have changed too much, yet perhaps of some note being the preference of lithium hydroxide over lithium carbonate (or vice versa) for battery manufacturers.<\/p>\n \u201cThat, combined with current depressed prices are the biggest changes I\u2019ve seen this year so far,\u201d Scallen says.<\/p>\n \u00a0<\/p>\n LU7\u2019s Liu says North America is positioning itself well to take advantage of moves by both the US and Canada to ensure downstream supply chains.<\/p>\n \u201cAustralia, Africa and Brazil produce spodumene concentrate, but have limited or no conversion capacity, so the spodumene is being shipped to China for conversion,\u201d Liu says.<\/p>\n \u201cWe believe the next emerging lithium supply country is Canada, specifically Quebec where there\u2019s a lot of lithium resources and potential to be the next lithium supply star.\u201d<\/p>\n Significant issues can be the slow process of getting a project off the ground into production and building processing facilities to supply battery-grade material for the OEMs.<\/p>\n \u00a0<\/p>\n \u201cThat\u2019s where Lithium Universe has got a great opportunity. We\u2019re going to be building a refinery at Be\u0301cancour where we can control that gap between those trying to develop a resource and the downstream processing that\u2019s already being invested in, in southern Canada,\u201d Scallan says.<\/p>\n It\u2019s secured a site just for a 16,000tpa lithium carbonate facility just 1km from GM\/POSCO\u2019s and Ford\/EcoProBM\u2019s two cathode factories to produce battery-grade lithium as part of its Que\u0301bec Lithium Processing Hub (QLPH) strategy.<\/p>\n There\u2019s over 20 large-scale battery manufacturers on North American\u2019s east coast and LU7\u2019s choice of location couldn\u2019t be poised any better to take advantage it seems.<\/p>\n \u00a0<\/p>\n LU7\u2019s QLPH site and surrounding OEMs. Source: LU7.<\/p>\n \u00a0<\/p>\n \u201cQue\u0301bec\u2019s low-cost hydroelectricity, high environmental standards, and educated workforce, as well as the location\u2019s logistical advantages, including a deepwater port and easy rail access to the rest of North America, were key factors in the decision,\u201d LU7 says.<\/p>\n \u00a0<\/p>\n\n \ufeff<\/span><\/span>\u00a0<\/p>\n At Stockhead we tell it like it is. While Lithium Universe is a Stockhead advertiser, they did not sponsor this article.\u00a0<\/em><\/p>\n <\/span><\/p>\n The post Lithium Universe wants capitalise on North America\u2019s supply chain gaps: Here\u2019s how<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"Demand to stay high and supply chain concerns<\/h2>\n
Changes in lithium over the decades<\/h2>\n
Canada to the rescue<\/h2>\n
Que\u0301bec Lithium Processing Hub strategy<\/strong><\/h2>\n