Lithium
Fastmarkets / CME
The lightest metal rode an 80,000-dollar rocket up in 2022 and a 90 percent crash back down, all before most of the world learned how it was priced.
Top Producers
share of 2025 mine production (lithium content)
Top Consumers
share of 2025 lithium chemical consumption
Main Uses
share of 2024 lithium demand by end use
Top Exporters
share of 2024 lithium trade by value; Australia ships spodumene concentrate to Chinese converters, Chile and Argentina export brine-derived carbonate, and China re-exports refined chemicals
Top Importers
share of 2024 lithium import value; China dominates as the refining hub buying spodumene feedstock, ahead of Japan and Korea importing finished chemicals
Global mine production
roughly 290,000 t lithium content (roughly 1.5 Mt LCE)
as of 2025
Battery share of demand
roughly 85%
as of 2025
China share of chemical refining
roughly 65%
as of 2025
2022 peak / 2024 trough (China spot carbonate)
roughly $80,000/t / below $10,000/t
CME benchmark
Lithium Hydroxide CIF CJK, USD/kg, cash-settled vs Fastmarkets
Lithium is the irreplaceable element in every mainstream electric vehicle battery, whether the cathode is nickel-rich NMC or iron-based LFP. It reaches the market in two main chemical forms, lithium carbonate and lithium hydroxide, made from two main resources: hard-rock spodumene ore, mined mostly in Western Australia and shipped to Chinese converters, and brine, pumped from beneath salt flats in Chile and Argentina and concentrated by solar evaporation. A third route, direct lithium extraction (DLE), pulls lithium from brine with sorbents or membranes in hours rather than months and is moving from pilot to commercial scale in Argentina, the United States, and China. Australia leads in mined volume, Chile in brine, and China dominates conversion, refining roughly two thirds of the world's battery-grade chemicals.
The price history is a full commodity cycle compressed into four years. As EV sales accelerated out of the pandemic, Chinese spot lithium carbonate rose from under $10,000 per tonne in 2020 to roughly $80,000 per tonne in November 2022, the steepest rally of any major commodity that decade. High prices did their work: new spodumene mines in Australia and Africa, brine expansions in Argentina, and Chinese lepidolite production flooded the market just as Chinese EV subsidy changes cooled demand growth. By late 2024 carbonate had collapsed below $10,000 per tonne, marginal mines were closing, and the industry had relearned the oldest lesson in commodities: the cure for high prices is high prices.
Pricing runs through price reporting agencies, chiefly Fastmarkets and Benchmark Mineral Intelligence, whose assessments of battery-grade lithium hydroxide and carbonate delivered CIF China, Japan, Korea (CIF CJK) anchor most western contracts. CME's cash-settled futures settle against the Fastmarkets assessments, while Guangzhou Futures Exchange runs a physically deliverable lithium carbonate contract that is now the most liquid lithium instrument anywhere. Most physical volume still moves on term contracts and offtakes, increasingly indexed to the assessments rather than fixed.
How It Trades
| Venue | CME Group (cash-settled futures and options), Guangzhou Futures Exchange (physically delivered carbonate), with the underlying spot market priced by Fastmarkets and Benchmark Mineral Intelligence assessments |
| Benchmark contract | CME Lithium Hydroxide CIF CJK (Fastmarkets) futures, launched May 2021; CME Lithium Carbonate CIF CJK futures added 2023; GFEX lithium carbonate futures (yuan-denominated) launched July 2023 |
| Contract size | 1,000 kg (1 metric tonne) per CME contract; GFEX contract is 1 tonne of lithium carbonate |
| Price terms | USD per kg, battery-grade lithium hydroxide monohydrate or carbonate, delivered CIF China, Japan, Korea (CIF CJK) |
| Settlement | Cash-settled against the arithmetic average of all assessments published by Fastmarkets for the relevant product during the contract month; GFEX settles by physical delivery of carbonate meeting exchange specs |
| Typical curve | Short and sparsely traded beyond a year; the curve flips between contango and backwardation with the inventory cycle rather than holding a structural shape |
| Liquidity | Thin by oil standards: CME open interest has grown from near zero in 2021 to tens of thousands of contracts, meaningful for hedgers but a rounding error next to WTI. GFEX is far more liquid intraday but operates inside China's capital controls. |
Where It Trades
approximate split of financial and physical volume, 2025; these markets are far less liquid than oil or base metals
Supply and Demand
Top producers
- Australia: roughly 92,000 t lithium content in 2025, almost entirely spodumene from Greenbushes, Pilgangoora, and other Western Australian mines
- China: roughly 62,000 t mined, plus roughly two thirds of global chemical conversion capacity
- Chile: roughly 56,000 t, brine from the Salar de Atacama (SQM and Albemarle)
- Zimbabwe: roughly 28,000 t, the fastest-growing African producer, largely Chinese-owned
- Argentina: roughly 23,000 t and rising fast as new brine and DLE projects ramp
- Brazil: roughly 12,000 t from Minas Gerais spodumene
Global mine output was roughly 290,000 t of lithium content in 2025 (excluding withheld US production), equivalent to roughly 1.5 million t of lithium carbonate equivalent (LCE). The "lithium triangle" of Chile, Argentina, and Bolivia holds the largest brine resources; Bolivia's remain barely developed.
Top consumers
- China: roughly 60 to 65 percent of global demand, home to most cell manufacturing
- South Korea and Japan: battery and cathode producers (LG, Samsung SDI, SK On, Panasonic)
- United States and Europe: growing cell buildout, still heavily import-dependent
Major uses
- Batteries (EVs, grid storage, electronics): roughly 85 percent of demand and nearly all growth
- Ceramics and glass: roughly 5 to 7 percent
- Lubricating greases, polymers, air treatment, pharmaceuticals: the remainder
A typical EV battery contains roughly 8 to 10 kg of lithium content. The chemistry split between hydroxide (favored for nickel-rich cathodes) and carbonate (favored for LFP) shifts demand between the two products; LFP's rise has favored carbonate.
What Moves the Price
- Global EV sales growth, especially in China, which sets the marginal tonne of demand
- Battery chemistry shifts: LFP versus nickel-rich NMC moves the carbonate-hydroxide spread; sodium-ion is a long-run substitution threat at the cheap end
- Mine ramp timelines: spodumene projects take 3 to 5 years, brine longer; supply arrives in lumps and overshoots
- Chinese lepidolite production economics, the high-cost swing supply that switches off below roughly $10,000 per tonne
- Chinese converter utilization and chemical inventories, the most-watched weekly data in the market
- DLE commercialization, which could compress brine project timelines and flatten the cost curve
- Policy: IRA sourcing rules, Chilean lithium nationalization framework (2023), Chinese EV subsidies
- Energy storage demand for the grid, the fastest-growing and least forecastable segment
Moments That Made the Market
2015
EV demand begins to dominate lithium consumption; prices double off a long flat base
2018
First boom peaks; Australian spodumene wave crashes prices into a two-year bear market
2020
Chinese carbonate bottoms below $6,000 per tonne; mines mothballed just before the EV surge
2021
CME launches cash-settled lithium hydroxide futures against the Fastmarkets CIF CJK assessment
2022
Chinese spot carbonate peaks at roughly $80,000 per tonne in November, up more than tenfold in two years
2023
Guangzhou Futures Exchange lists physically delivered carbonate futures; prices halve as supply floods in
2024
Carbonate falls below $10,000 per tonne; Australian and Chinese marginal mines curtail output
2025
Market stabilizes at low prices; western converter projects slow while demand keeps compounding
What Changed Since the 2010 Handbook Era
- In 2010 lithium was a niche specialty chemical sold by three producers on opaque annual contracts; there was no spot market worth quoting and no futures contract at all
- A liquid-enough derivatives complex now exists: CME cash-settled futures since 2021 and a physically delivered Chinese contract since 2023
- Demand tripled in a decade and flipped from ceramics and greases to batteries, which now take roughly 85 percent of supply
- Price reporting agency assessments (Fastmarkets, Benchmark) became the contractual backbone of the industry, the role Platts plays in oil products
- Lithium joined every major critical minerals list, and sourcing rules in the US Inflation Reduction Act now route trade flows as much as economics do