Overnight, U.S. lithium mining stocks continued their upward trend, with Sigma Lithium surging 13%, while Sociedad Química y Minera de Chile (SQM) and Albemarle Corporation also posted gains. Reports indicate that the U.S. Department of Defense is stockpiling critical minerals under the National Defense Stockpile Initiative, covering at least 38 minerals and metals, including lithium, cobalt, graphite, and rare earth elements—key materials for energy transition.
On December 3, Vulcan Energy announced securing nearly $2.5 billion in financing to develop Europe's largest lithium production project. Exchange filings reveal that the first phase of Germany's Lionheart lithium project aims for an annual production capacity of 24,000 tons of lithium, with offtake contracts fully secured for the first decade. "The lithium produced in Phase 1 could meet the annual demand for approximately 500,000 electric vehicles," the filings noted.
CITIC Securities Research predicts that total lithium battery demand in 2024 may exceed 2,700 GWh, a year-on-year increase of over 30%, with energy storage battery demand surpassing 900 GWh. Multiple segments of the lithium battery supply chain could face shortages.
Huatai Securities estimates that by 2026, global lithium supply growth will primarily come from new domestic salt lake projects, expanded production in African and Australian mines, and ramp-ups in South American salt lake operations. Under a neutral scenario, global lithium supply is projected at 1.634 million tons LCE in 2025, 2.162 million tons in 2026, and 2.532 million tons in 2027, with year-on-year growth rates of 22.3%, 32.3%, and 17.1%, respectively. Given current high lithium prices stimulating production, Huatai forecasts 2026 supply at 2.057 million, 2.162 million, or 2.234 million tons LCE under three price scenarios (below RMB 80,000/ton, RMB 80,000–90,000/ton, and above RMB 90,000/ton).
CITIC Securities highlights investment opportunities in the lithium industry for 2026, emphasizing companies with high resource self-sufficiency and significant production growth potential. High self-sufficiency ensures stable supply and high margins, mitigating risks from potential commoditization of lithium processing. As lithium gains strategic importance globally, overseas governments are increasingly prioritizing its supply.
Additionally, industry consolidation during downturns favors companies with low-cost, high-quality resources, enabling stable operations and strong cash flow for acquisitions—key traits for weathering market cycles. With lithium price volatility easing, replicating historical highs (e.g., RMB 600,000/ton) is unlikely. Investors should focus on companies with substantial capacity and output growth.
Related Hong Kong-listed lithium stocks: Tianqi Lithium (09696), Ganfeng Lithium Group (01772), and Lopal Tech (02465).
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