Albemarle, the world’s leading producer of lithium, has predicted that China’s electric vehicle (EV) market will grow by at least 40% this year, resulting in a surge in demand for the critical battery metal in the world’s largest auto market. The company’s executives have stated that Chinese lithium customers are not slowing down orders, and the country’s stockpiles of cathodes and battery parts are decreasing, indicating strong demand for the battery metal.
Despite the Chinese government’s recent efforts to phase out subsidies for EVs, Albemarle has observed only a “limited impact” on EV demand so far. While weak Chinese auto sales data in January was attributed to the Lunar New Year holiday, executives believe that China’s EV market will continue to expand at an impressive rate.
“Our biggest challenge is managing the tremendous growth opportunity in front of us,” stated Chief Executive Kent Masters during a conference call with investors after the company posted better-than-expected quarterly results. Albemarle is looking to capitalize on this growth by potentially partnering with an automaker for a planned European lithium processing plant.
Furthermore, the company is in “active discussions” about restructuring its MRBL joint venture in Australia with Mineral Resources Ltd. Additionally, executives expressed hope that the US Inflation Reduction Act would make permitting easier for Albemarle’s planned lithium mine in Kings Mountain, North Carolina.
