Jiangxi Lithium Industry: Cost efficiency and environmental sustainability

The stable supply of lithium resources is paramount for the new energy industry. Currently, lithium carbonate enterprises in Jiangxi, China can be categorized into two main types: resource self-sufficient and processing-trade oriented, with notable differences in production capacity expansion. 

Resource Self-Sufficient Enterprises leverage local lepidolite resources and technological advancements, offering advantages in cost control and supply chain stability. Processing-Trade Enterprises rely on market channels and flexible capacity allocation, focusing on lithium salt refining while maintaining close ties with lithium resource suppliers. 

1. Resource Self-Sufficient Enterprises:

Company A: Primarily responsible for the storage, operation, and management of lithium mines within the administrative region, relying on Yichun's mining resources. In 2024, raw ore extraction reached 20 million tonnes, with lithium carbonate production at 110,000 to 120,000 tonnes of LCE. By 2025, with capacity expansion in the Tong'an and Dagang mining areas, raw ore production is expected to increase by 10 million tonnes, raising lithium carbonate capacity to 150,000 to 160,000 tonnes of LCE. 

Company B: Owns a lithium mine with an annual capacity of 3 million tonnes and a beneficiation capacity of 4.5 million tonnes, achieving a 100% self-sufficiency rate in raw materials. The company plans to expand its mining capacity to 9 million tonnes and support lithium carbonate production of 40,000 to 50,000 tonnes in 2025, which highlights its significant lithium resource advantages. The company employs advanced tunnel kiln roasting technology, which is 15% more energy-efficient than traditional rotary kilns, ensuring full reaction efficiency and higher recovery rates. 

Company C: Utilizes deep-mined lithium ore (grade 1.3% to 1.5%) with a direct crushing and grinding process, eliminating the need for flotation. Combined with open-pit lepidolite concentrate, the production cost is significantly lower than conventional lepidolite processing. With a smelting cash cost of Yuan 70,000/t, the company maintains high capacity utilization and strong market competitiveness. 

Company D: Uses lithium concentrate produced by its shareholder company, ensuring a stable supply of raw materials (full-capacity production of 16,000 tonnes of LCE per month). Mainly processing lepidolite concentrate with a grade of 1.6% to 1.7%, the company employs a sulfate calcination method with a recovery rate exceeding 75%. Despite overall industry pressure, the company's production remains unaffected, with its 40,000-tonne-per-year lepidolite production line operating at near full capacity. 

2. Processing-Trade Enterprises:

Company E: Relies on imported African lithium ore (accounting for 30% of its production capacity), with raw material costs reaching Yuan 1,000/tonne-degree (including Yuan 1,600 per tonne in logistics costs). The company has a planned annual capacity of 50,000 tonnes, with 25,000 tonnes already operational. However, further expansion is constrained by the stability of the ore supply. Current monthly production stands at 1,500 tonnes, with expectations to ramp up to 4,000 tonnes per month in the second half of the year. 

Company F: Lacks mines and purchases Australian ore (Yuan 1,226/tonne-degree) and 2.3% lepidolite, with processing costs reduced to Yuan 23,000 to Yuan 25,000 per tonne. The company operates two production lines: lepidolite with an annual capacity of 10,000 tonnes and spodumene with 8,000 tonnes per year. However, its utilization rates remain at just 40% - 50%, and it faces cost inversion pressures. Since 2024, the company has enhanced its magnetic separation process to reduce impurities and improve product purity. 

Company G: Primarily uses various crude lithium carbonate sources as raw materials and owns a mine with a grade of 0.2% - 0.4%. The original plan was to produce 800,000 tonnes of lepidolite concentrate annually, but development was postponed due to price constraints. The company's main product, battery-grade lithium hydroxide, features low potassium and sodium content, as well as low carbonate levels --below the national standard of <0.4% and the stricter Japanese and Korean requirements of <0.2% -- meeting high-purity grade standards. 

The Importance of Energy and Tailings Treatment:

Jiangxi's lithium extraction from lepidolite exhibits significant cost differentiation, with key differences as follows:

Source: Mysteel 

Cost-Reduction Strategies:

Energy Optimization: 

Natural gas accounts for up to 30% of costs (with 60 - 70 cubic meters consumed per tonne of ore). Companies lower energy consumption through waste heat recovery and equipment upgrades. 

By-Product Value Addition:

Sales of feldspar powder (a ceramic raw material) can offset a small portion of costs, and recovery of tantalum-niobium tailings (currently in the pilot phase) is expected to generate additional revenue. 

Process Upgrades:

Using tunnel kiln roasting (B Company) and sulfate calcination (D Company) boosts lithium recovery rates to 75 - 80%, thereby reducing unit consumption costs. 

Environmental Protection SolutionsUnder pressure from Yichun's environmental policies, companies are actively exploring differentiated solutions. 

Short-Term Solutions:

Construction of Centralized Tailings Repositories: Tailings treatment costs range between Yuan 50 - 100/t. Some companies have built their storage capacity to meet stacking needs for the next 3 to 5 years, ensuring environmental compliance. 

Promotion of Feldspar Powder Ceramic Production: Although the overall utilization rate of feldspar powder is currently low, demand in the building materials sector has not been fully realized amid a weak real estate market. 

Long-Term Solutions:

Metal Extraction: Some companies are recovering high-value metals such as tantalum, niobium, and rubidium from tailings (currently in the experimental stage), with industrial-scale implementation expected within 2 to 3 years to further reduce overall costs. 

Circular Economy: Some companies are adopting a "lithium extraction - tailings - building materials" model or "deep ore silicon utilization" technology to convert environmental costs into synergistic benefits across the industrial chain, achieving a win-win for both the economy and environmental protection.