Will lithium production in Australia account for more than 50% of the world's total?

As the world's new mines go online, the world's demand for battery materials for electric vehicles is growing, and Western Australia is expected to produce more than half of the global lithium battery supply by the end of this year.

Citigroup analyst Clark Wilkins made the prediction last week on the same day that Ken Brinsden, managing director of lithium mining company Pilbara mining, said Australia was at the "lithium pole" and described parts of Western Australia as the "lithium valley".

But with the growth of Australia's emerging lithium industry so fast, investors have also been reminded that there will be "tortures" and twists and turns.

Most of the world's lithium mines are now from hard rock mining of the spodumene or by extracting lithium from brine mines in Argentina and Chile.

But given the hard rock mines that are now operating in Western Australia or about to begin operations, Australia is well positioned to take advantage of the rapid growth in the use of electric vehicles in major automotive markets such as Europe and China in the coming years.

“If you look at all the hard rock (lithium mines), Western Australia will dominate. By the end of this year, Western Australia will exceed more than half of the global lithium battery supply. Because all the hard rock mines in the world are basically in the west. Australia," said Mr Wilkins.

“There are projects outside of Australia, but none of these projects can really be mass-produced in a few years. Because you have the infrastructure, you have a mining culture, and the biggest project is often in Australia, so Australia does leading the world in the development of these hard rock mines."

Lithium is a key component in the manufacture of lithium-ion batteries for electric vehicles, large battery storage units and electronic devices such as cell phones and laptops.

Mr. Brinsden said in a speech at the Melbourne Mining Club on Friday that Pilbara Mining's Pilgangoora mine will be "one of the world's largest lithium mines", which is only a week or two away from the processing plant. The plant will smash and treat rocks from mines to produce lithium-based spodumene concentrates.

“We hope to ship spodumene for the first time at some time at the end of June,” Mr. Brinsden said.

Mr. Brinsden said that Australia is the world's largest producer of spodumene concentrates, mines are already in production and more mines are being produced.

“Australia has a polar position in lithium raw materials, and because we have an incredible mineral endowment in hard rock sources, we may hold it for many years to come,” he said.

Although Australia holds the “extreme position” of lithium, ASX-listed lithium companies have experienced fair fluctuations in the market, and stock prices have fluctuated in recent months.

Pilbara Mining's share price reached its highest closing price in early January, at $1.22, but then the lithium market may oversupply in the next few years as fears rise. Pilbara closed up 1 cent on Friday to close at 89 cents.

“I think the industry is experiencing a period of rapid growth, which is obviously risky. The risks are mainly in project definition, project financing, customer acquisition relationships and key project execution. Then, accelerate to a stable state. All these are not without risk, "Like Lanshaw, commodity strategist at UBS, said.

“I think this is the first thing, the industry is experiencing very rapid growth and there will be bumps and curves along the way,” he said.

In addition, in terms of demand, people's understanding of the "battery chain" is still developing. “There are many different perspectives on the growth of demand and the way the industry works. And because the scope of the opinions is so diverse, it increases volatility,” he said.

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