China’s early move to tap new centers of lithium supply across Africa is reaping rewards, helping the top electric-vehicle battery producer navigate a tight market for the key metal.
Spurred by a flurry of investment from Chinese companies, mines across the continent are forecast to increase production of lithium raw materials more than 30-fold from last year’s volume by 2027, according to S&P Global Commodity Insights. Africa will account for 12% of global supply by then, compared with 1% in 2022.
Diversifying supply sources will boost China’s efforts to defend its dominance in EV metals processing — transforming raw materials like lithium, nickel and cobalt into chemicals used in battery components — while the US ratchets up efforts to build out its own supply networks with free-trade partners and allies like Canada and Australia.
“It is a sure thing that Africa will play an important role for China,” particularly as an alternative source of raw materials to Australia, currently the top supplier and where exports could be constrained as domestic refineries come online, said Peng Xu, a Beijing-based analyst for BloombergNEF.
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