With batteries being the most costly component of electric vehicles (EVs), it is clear why EV makers are looking for ways to secure supply of key metals such as lithium.
Despite a current global slump, demand for EVs is expected to continue trending upward going forward as the world moves away from fossil fuels to greener sources of energy.
For now the lithium market remains in oversupply. However, the long term demand for lithium carbonate equivalent looks set to increase to 2.5 million metric tons (MT) by 2030, up substantially from the 292,000 MT of demand recorded in 2020.
For car manufacturers from Tesla (NASDAQ:TSLA) to General Motors (NYSE:GM), the past few years have seen the race to secure a steady supply of lithium increase as price volatility and geopolitical tensions expose the vulnerabilities of the global lithium supply chain.
Current lithium producers have already committed to contracts with battery manufacturers and carmakers, but which juniors have inked deals for supply yet to come on stream? Read on to find out. All lithium stock data was current as of September 5, 2024.
1. Liontown Resources (ASX:LTR)
Market cap: AU$1.52 billion; share price: AU$0.62
Liontown Resources bills itself as a future Australian lithium producer, with two lithium projects in Western Australia, including its flagship Kathleen Valley project. The mine came online in July 2024, and is expected to produce approximately 500,000 MT per year of spodumene concentrate by the end of Q1 2025, with an expansion planned in year six to bring its production to 700,000 MT per year.
The last few years have been busy for Liontown. In February 2022 it inked a deal with US EV maker pioneer Tesla. The deal is for an initial five year period starting in 2024 and accounts for about one-third of Kathleen Valley’s start-up production capacity.
In June 2022, Liontown signed another five year offtake agreement with carmaker Ford (NYSE:F) for the supply of up to 150,000 dry metric tons (dmt) from the Western Australia project.
Aside from Tesla and Ford, Liontown also has an offtake agreement with South Korea’s LG Energy Solution (KRX:373220). In July 2024, Liontown and LG signed a significant extension to their existing offtake agreement for another 10 years. That same month, Liontown announced a 10 month offtake agreement with China’s Beijing Sinomine International Trade for up to 100,000 dmt of spodumene concentrate beginning in late September.
2. Vulcan Energy Resources (ASX:VUL)
Market cap: AU$705.71 million; share price: AU$3.75
Europe-focused Vulcan Energy Resources says its combined geothermal energy and lithium resource is the largest in the region, with license areas in Germany’s Upper Rhine Valley and in Italy. The company touts its lithium project as being a zero-carbon asset. In August 2024, Vulcan reported that it had begun commissioning of its lithium hydroxide optimization plant, CLEOP, near Frankfurt, Germany.
Netherlands-based Stellantis (NYSE:STLA), which was created from the merger of Fiat Chrysler and France’s Peugeot, bought an 8 percent stake in Vulcan in 2022, extending its initial lithium supply agreement that was signed at the end of 2021. The carmaker expanded its partnership with the lithium company in January 2023 to develop geothermal energy projects in Germany.
Starting in 2026, Vulcan is also set to deliver lithium for an initial six-year term to Renault (EPA:RNO), which is expected to purchase between 26,000 and 32,000 MT of battery-grade lithium chemicals during the binding offtake deal.
Vulcan also signed a binding offtake deal with Volkswagen (FRA:VOW) to begin in 2026 for between 34,000 and 42,000 MT of battery grade lithium hydroxide over the duration of the lithium supply deal.
Aside from signing supply deals with automakers, Vulcan has inked agreements with battery materials maker Umicore (EBR:UMI) and South Korea’s LG Energy Solutions.
3. Lithium Americas (NYSE:LAC)
Market cap: US$680.16 million; share price: US$3.12
Lithium Americas owns 100 percent of the Thacker Pass lithium claystone project in the US, which is projected to begin production in the second half of 2027. With a mine life of 40 years, the project will have an annual production capacity of 40,000 MT per year during Phase 1 and 80,000 MT per year in Phase 2. According to estimates from the company, the lithium extracted and processed from the project will be able to support the production of up to 1 million EVs on an annual basis.
In addition to Thacker Pass, Lithium Americas is developing the Caucharí-Olaroz project in Jujuy, Argentina, together with Chinese top lithium producer Ganfeng Lithium (OTC Pink:GNENF,HKEX:SZSE:002460). Lithium Americas also owns the Pastos Grandes lithium brine project in Salta, Argentina.
Lithium Americas inked a massive lithium supply deal with General Motors at the end of January 2023 to develop the Thacker Pass mine in Nevada. GM’s US$650 million equity investment in Lithium Americas is the largest investment by an automaker to produce battery raw materials.
4. Ioneer (ASX:INR)
Market cap: AU$328.34 million; share price: AU$0.14
Ioneer wholly owns the Rhyolite Ridge lithium-boron project in Nevada, US — according to the company, the asset is the only known lithium-boron deposit in North America, and one of only two such known deposits in the world. Rhyolite Ridge is projected to have an annual capacity of 20,600 MT of lithium carbonate and nearly 174,400 MT of boric acid. The company expects the project will be fully permitted by the end of 2024.
In January 2023, the company received a US$700 million loan from the US Energy Department to build its mining project in Nevada. Rhyolite Ridge is estimated to produce enough lithium to build 370,000 EVs each year.
Ioneer has a binding offtake agreement with Ford to supply 7,000 MT of lithium carbonate annually for five years to BlueOvalSK, the carmaker’s battery joint venture with SK Innovation, which will begin by the end of 2025.
The junior lithium company has also inked a deal with Prime Planet Energy & Solutions, a joint venture between Toyota (OTC Pink:TOYOF,TSE:7203) and Panasonic (OTC Pink:PCRFF,TSE:6752), for the supply of 4,000 MT of lithium carbonate per year for five years.
Korean battery materials manufacturer EcoPro expanded its partnership with Ioneer in October 2023 under an R&D MoU targeting the lithium clay resource found at Rhyolite Ridge. In addition, EcoPro will fund and build a commercial-scale refining plant.
5. Piedmont Lithium (ASX:PLL)
Market cap: AU$206.82 million; share price: AU$0.12
ASX-listed Piedmont Lithium is another lithium miner that has a supply deal with Tesla. The lithium company is supplying the US automaker with spodumene concentrate from the North American Lithium operation, which Piedmont and its joint venture partner Sayona Mining (ASX:SYA) brought back online in 2023 through their 25/75 joint venture.
Piedmont will deliver approximately 125,000 MT of spodumene concentrate from its portion of production to Tesla from the second half of 2023 through to the end of 2025. Tesla has the option to extend the arrangement for another three years.
North American Lithium, which is located in Quebéc, Canada, is not the only project Piedmont Lithium is developing in North America. With a goal of becoming one of the largest lithium hydroxide producers in the region, the company is also working to develop its Carolina Lithium project, receiving a mining permit in April 2024. In Ghana, it has a partnership with Atlantic Lithium (ASX:A11,LSE:ALL), which is developing the Ewoyaa lithium project.
6. Rock Tech Lithium (TSXV:RCK)
Market cap: C$118.46 million; share price: C$1.17
Rock Tech Lithium’s approach includes the production of sustainably sourced spodumene feedstock from its Ontario-based Georgia Lake project, as well as the construction of lithium hydroxide converters in Europe. In May 2024, Rock Tech received construction and operations permits for its Guben refinery, which has a planned annual capacity of 24,000 MT of lithium hydroxide monohydrate. This was the final approval needed for the refinery.
In the years to come, the company expects to source raw material from recycling discarded batteries, pledging to have 50 percent of its feedstock at its German convertors come from recycled lithium by 2030.
In October 2022, the company signed a lithium supply deal with German carmaker Mercedes-Benz (OTC Pink:MBGAF,ETR:MBG). The deal is set to start in 2026 and would see Rock Tech supply an average of 10,000 MT of battery-grade lithium hydroxide per year over a five-year term.
7. Anson Resources (ASX:ASN)
Market cap: C$116.61 million; share price: C$0.095
Anson Resources has two key properties under development in Utah’s resource-rich Paradox Basin: the Paradox and Green River lithium projects, both within 50 kilometers of each other. Paradox has the potential to become a significant lithium-producing operation. The project hosts a mineral resource estimate of 1.04 million MT of lithium carbonate equivalent and 5.27 million MT of bromine. Anson Resources is also conducting a major resource expansion program at Paradox.
In August 2024, the company produced its first battery-grade lithium carbonate from brines at Paradox. The company can now provide product samples to potential off-take partners.
Earlier in the year, Anson announced it had secured a binding offtake agreement with LG to supply battery grade carbonate from Paradox. Under the deal, the tech giant would purchase 4,000 dry metric tons per year of battery-grade lithium carbonate over five years beginning in 2027, and it has the ability to extend the contract for another five years.
8. European Lithium (ASX:EUR)
Market cap: AU$53.13 million; share price: AU$0.038
European Lithium’s fully licensed Wolfsberg hard-rock lithium deposit in Austria is expected to start production in Q1 2025. According to a March 2023 definitive feasibility study, the asset would have an average production rate of 780,000 MT per year, peaking at 840,000 MT, over a 14.6 year life of mine. The ASX-listed company is aiming for the operation to be the first and largest local supplier of lithium hydroxide in the region.
In February 2024, its subsidiary European Lithium AT merged with Sizzle Acquisition, a special purpose acquisition company, to create US-listed company Critical Metals (NASDAQ:CRML). Wolfsberg is the flagship project of Critical Metals, and European Lithium is the largest shareholder in this new firm at 85 percent.
European Lithium also holds a supply agreement with BMW (OTC Pink:BMWYY,ETR:BMW). In keeping with the deal, the German carmaker made an upfront payment of US$15 million in June 2024 for future supply of lithium hydroxide from Wolfsberg.
9. Greenwing Resources (ASX:GW1)
Market cap: AU$12.69 million; share price: AU$0.053
Australia-based Greenwing Resources is a critical minerals explorer and developer that has lithium and graphite projects spread across Madagascar and Argentina.
In September 2022, the lithium junior struck a deal with Chinese electric carmaker NIO (NYSE:NIO,HKEX:9866), which agreed to pay AU$12 million to become Greenwing’s largest shareholder. The strategic investment is expected to help with the development of Greenwing’s San Jorge lithium project in Catamarca province, Argentina, and aligns NIO as the company’s potential joint venture and offtake partner.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
