Australia’s lithium mining boom hit by sagging prices

The first refined lithium to be commercially produced in Australia happened back in 2022, when Perth-based IGO announced that it was making battery-grade lithium hydroxide at its Kwinana Refinery in Western Australia. It co-owns the facility with Chinese firm Tianqi Lithium.

Meanwhile, another Australian miner, Covalent Lithium, is building its own lithium refinery,, external also in Western Australia. And Albemarle has its refinery, albeit one currently reducing its output.

Some commentators welcome the development of lithium refining in Australia, saying it will help to reduce China’s dominance, external of the global market for the metal. China currently accounts for 60% of all, external lithium refining.

However, Kingsley Jones says that Australia needs to be more open to embracing Chinese investment in the lithium sector. He points out that the Australian government has, in his view, “adopted a strategy, we think unwisely, to preference investment from countries other than China” in the lithium sector in recent years.

This has come as relations between the two countries have cooled since 2020. Last year, Canberra even blocked the sale, external of an Australian lithium miner to a Chinese firm.

The government said at the time that it was simply following the advice of the country’s Foreign Investment Review Board.

Mr Jones adds: “It’s an excellent example of how to shoot yourself in the foot as a producer. You tell the biggest buyer to go away. So, they do.”

Australia’s Department of Industry, Science and Resources did not respond to a request for a comment.