Australia’s Lithium Ore Exports Exceeds $1 Billion in June, China Largest Buyer

Lithium batteries displayed in the workshop of a lithium battery manufacturing company in Huaibei, eastern China's Anhui Province, on Nov. 14, 2020. STR/AFP via Getty Images

Australia’s lithium exports hit a record high in June, with China becoming the country’s largest buyer, a new trade export data showed.

Lithium concentrates exports reached $1.163 million (US$810 million) in June, an increase of 1,189 percent compared with the same month last year, according to lithium export data released by the Australian Bureau of Statistics (ABS) on Aug. 4.

Despite continuing trade tensions with Beijing, $1,128 billion worth of lithium concentrate was exported to China, accounting for 97 percent of total lithium exports in the month.

From late 2021 onwards, lithium exports began to increase rapidly, more than doubling from November to December 2021, almost doubling again from April to May 2022, and surpassing $1 billion for the first time in June 2022, the data showed.

Lithium is a key material used in the production of electric vehicles (EVs), renewable energy storage, and rechargeable batteries for consumer devices such as mobile phones, laptops, and cameras, causing the global demand for lithium has increased dramatically in recent years.

Australia is the world’s largest exporter of lithium. In 2020, 46 percent of the world’s lithium came from Australia, according to ABS. The Bureau expects lithium exports to continue to increase and contribute a further $9.4 billion to the Australian economy by 2023-24.

Lithium is an essential material used in the production of electric vehicles (EVs), renewable energy storage, and rechargeable batteries for consumer devices such as mobile phones, laptops, and cameras, causing the global demand for lithium has increased dramatically in recent years. Bjoern Wylezich/Shutterstock

Australia exports almost all of its lithium to China which in 2021 accounted for more than 85 percent of the total lithium export value, and in 2022 accounted for more than 94 percent.

The bureau’s data also showed a record trade surplus of $17.7 billion in June, driven by iron ore, coal, and gas exports. Iron ore exports rose 5.5 percent to $15.5 billion, with shipments to China, Vietnam, and Taiwan rising sharply.

Concern over China’s Dominance in Global Lithium Supply

However, the lithium industry has a high degree of market concentration. In 2020, five companies accounted for nearly half of the world’s lithium production capacity, producing approximately 75 percent of the worldwide supply, according to a report released by China Merchants Bank Research Institute on March 4.

Two of the five companies—Jiangxi Ganfeng Lithium Co. Ltd. and Tianqi Lithium Co. Ltd.—are Chinese, both of which have taken up significant shares in global lithium resources.

A worker with car batteries at a factory for Xinwangda Electric Vehicle Battery Co. Ltd, which makes lithium batteries for electric cars and other uses, in Nanjing in China's eastern Jiangsu Province, on March 12, 2021. STR/AFP via Getty Images

China’s dominance in global lithium supply has raised concern in the United States, with U.S. lithium battery manufacturer OneCharge releasing a report about the risks.

“Upwards of 70% of the total global Li-ion battery manufacturing capacity is controlled by China,” the report stated. “Should China decide to throttle supply or dramatically raise prices, this would hurt the U.S. transportation and logistics sectors, which are quickly adopting lithium battery-powered electric vehicles.”

Ganfeng’s overseas footprint in lithium resources spans Australia, Argentina, and Ireland, according to its 2021 annual report. Among them, the Mount Marion Project in Australia is the largest source of the Chinese battery giant’s lithium resources.

Tianqi also has some of its lithium resources related to Australia. In 2014, Tianqi Lithium acquired 51 percent shares in Windfield Holdings, the shareholder of Talison Lithium, which owns the Greenbushes lithium deposit in Western Australia—the world’s largest hard-rock lithium mine.

Kathleen Li contributed to this report.