Lithium demand will more than triple by mid-century, and meeting it will require the equivalent of 134 new mines. This forecast was presented by research firm Benchmark Mineral Intelligence. Total investment is estimated at more than $100 billion, and the main challenge will be sustaining financing through price cycles.
According to Benchmark’s calculations, lithium consumption will grow from 2.11 million tonnes of lithium carbonate equivalent this year to almost 7 million tonnes by 2050. With an average mine capacity of 36,000 tonnes per year, this means launching one new operation roughly every two months for 24 years.
Cameron Perks, Benchmark’s lithium products director, named the main difficulty as maintaining investment through price cycles while competing for capital with artificial intelligence, defense, and the energy transition. Financial constraints, lengthy permitting, and competition for investment complicate bringing capacity online, especially in the West, which is seeking to reduce its dependence on China.
The demand structure is changing. By 2050, electric vehicles will account for 76% of lithium consumption, compared with 55% today. Batteries already account for 92% of demand, versus about 70% in 2020. Stationary energy storage has grown by more than 60% annually over the past two years, although Benchmark expects growth to slow to around 5% per year before the end of the decade.
Australia, the largest lithium-mining jurisdiction, will provide 29% of global output this year, but by 2050 its share may fall to 20% due to depletion of existing mines and growth elsewhere. China will retain roughly a quarter of global production thanks to investment in its own resources and its position in the battery supply chain. North America could raise its share from 1.7% to 13%, and Europe from less than 1% to 5.5%, although this will still not be enough to cover its own demand for cells.
Developing new mines in these regions will be difficult: some promising deposits require unproven technologies or face environmental and community objections. According to Perks, these obstacles are surmountable but lead to delays and higher project costs.
A separate bet is placed on recycling. Benchmark expects recovered material to cover almost half of lithium supply by mid-century. However, this depends on the volume of end-of-life batteries and the cost competitiveness of recycling. In an optimistic scenario, demand could reach 9 million tonnes, requiring about 180 mines and more than $150 billion in investment. Capital expenditure through 2040 is estimated at roughly $64 billion.
The future of the lithium industry depends on two things: the ability to attract money through volatile cycles and the speed at which recycling scales. Every tonne that recycling fails to provide will have to come from a new mine, and that is the key question for the entire supply chain.
Source: Benchmark Mineral Intelligence
Image: Nornickel
