Lithium prices hit new highs following major mine shutdown

Prices for lithium, which is used in battery production, rose sharply on Monday, August 11. This happened amid the closure of one of China's largest lithium mines, Bloomberg reported.

Contemporary Amperex Technology (CATL), the world's largest battery manufacturer, confirmed the closure of its Jianxiawo mine in China after its license expired.

According to Bloomberg, production will be shut down for at least three months. This mine accounts for about 6% of global lithium production, while other mines in the region account for at least another 5%.

This move by the giant company shook the market. Prices for battery metal on the Guangzhou Futures Exchange rose to the daily limit. Shares of Chinese company Tianqi Lithium rose 19%, and Ganfeng Lithium rose 21%.

Lithium producers are currently struggling with a global oversupply. This is exacerbated by obstacles to demand for electric vehicles, in particular due to US President Donald Trump's cancellation of incentives for this industry.

Lithium is a light metal characterized by high reactivity and used in various industries, including medicine, electronics, and battery manufacturing.

Trump against electric vehicles

The conflict between US President Donald Trump and billionaire Elon Musk arose after Musk criticized a bill on taxes and spending. The billionaire stressed that he could no longer remain silent and called the document disgusting filth.

Trump said that the billionaire was unhappy that the initiative would eliminate subsidies for electric cars. The media also reported that Trump was giving up his Tesla electric car.

After the public quarrel and another round of criticism from Musk, the US president hinted at the possible deportation of the billionaire.