As the global production of batteries and electric vehicles (EVs) accelerates, the demand for lithium is projected to surge to unprecedented levels, reaching 1.5 million tonnes of lithium carbonate equivalent (LCE) by 2025 and over 3 million tonnes by 2030. For context, in 2021, the world produced only 540,000 tonnes of LCE. These projections indicate that lithium production needs to triple by 2025 and increase nearly six-fold by 2030 to meet the burgeoning demand. This dramatic increase underscores the critical role lithium will play in the global shift towards sustainable energy solutions, driven by the widespread adoption of EVs and renewable energy storage systems.

However, the supply side of the lithium market faces significant challenges. Despite exponential growth in production, the timeline for bringing new lithium projects online can range from six to more than 15 years. This lengthy development period includes stages such as exploration, securing financing, obtaining regulatory approvals, constructing facilities, and ramping up operations. Consequently, the lithium market is anticipated to experience a supply deficit in the coming years, as the rapid increase in demand outpaces the ability of new projects to come online. This deficit could lead to increased prices and heightened competition for available resources, further emphasizing the need for strategic investments and expedited project development to ensure a stable and sufficient lithium supply to support the global energy transition.