SHENZHEN: China refines 60-70% of the world’s lithium chemicals-primarily from Australian spodumene and South American brine-making it the decisive bottleneck in the global EV supply chain.
Lithium is not scarce, but battery-grade purity is. Mines yield lithium-bearing ore or brine; only advanced refining produces the tightly specified lithium carbonate and lithium hydroxide required by EV battery makers.
China lacks top-tier reserves but leads in industrial scale, integration, and cost efficiency. It controls ~86% of cathode active material production and ~85% of battery cell manufacturing-often within co-located industrial clusters.
US and EU refining projects remain in early ramp-up. Tesla’s Texas refinery and AMG’s Brazil-to-China-to-Germany flow underscore the gap between nameplate capacity and operational reality.
Analysts project meaningful decoupling from Chinese refining will take until late-2020s to 2030s-due to technical complexity, energy intensity, waste management hurdles, and the need for qualified, high-yield output backed by long-term offtakes.
Lithium remains central to EV batteries for at least five to ten years-even as sodium-ion gains traction on adapted Chinese lithium lines.