According to data provided by Technavio, the global lithium-ion battery market is expected to reach USD 81.65 billion by 2021, at a CAGR of over 11%. The increased usage of lithium is due to rising demand for batteries to power everyday portable consumer electronics and electric vehicles (EVs). Earlier this week Bloomberg reported that Volkswagen AG, the world’s largest carmaker, secured 20 billion euros ($25 billion) in battery supplies to reinforce its strong investment in EVs. The move is expected to put more pressure on Tesla Inc. as it copes with production issues for their mainstream Model 3. According to the report Volkswagen plans to equip 16 factories to produce electric vehicles by the end of 2022, compared to three factories currently. Additionally, Volkswagen expects to manufacture 3 million cars a year by 2025, an ambitious goal that is backstopped by deals with battery suppliers such as Samsung, LG Chem Ltd. and Contemporary Amperex Technology Ltd. for in Europe and China. Millennial Lithium Corp. (OTC: MLNLF), Albemarle Corporation (NYSE: ALB), Sociedad Química y Minera de Chile S.A. (NYSE: SQM), Lithium Americas Corp. (NYSE: LAC), Tesla Inc. (NASDAQ:TSLA)
A recent report published by Industrial Minerals is showing that the increasing popularity of EV’s has translated into a record demand for lithium. Chinese battery-grade lithium carbonate prices have risen since the lunar New Year to almost record highs. The spot price for battery-grade lithium carbonate (min 99.5% Li2CO3) increased to 150,000-160,000 yuan ($23,676–$25,254) per ton. China’s appetite for lithium is evident as more acquisitions of lithium producers continue to take place. Recently TSX.v listed Canadian company Lithium X Energy Corp completed a plan of arrangement with Nextview New Energy Lion Hong Kong Limited, according to which NextView has agreed to acquire all of the issued and outstanding common shares and warrants of Lithium X for $2.61.
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