Lithium prices in China rose sharply after authorities in the country’s main lithium-producing hub announced plans to revoke dozens of mining licences, fuelling investor concerns over future supply.
The most actively traded lithium carbonate contract on the Guangzhou Futures Exchange climbed as high as 109860 yuan per metric ton on Wednesday, its highest level since June 2024, before closing up 7.61% at 108620 yuan.
The Bureau of Natural Resources of Yichun, a key lithium centre in Jiangxi province, said it intends to cancel 27 mining permits following a public consultation period ending on January 22. The notice was published on the bureau’s official website last week.
According to the published list, all of the licences have already expired, in some cases more than ten years ago. Most were originally issued for ceramic clay or limestone mining. One permit linked to a lithium-bearing ceramic stone mine was held by Jiangxi Special Electric Motor, which said it has lodged an objection with local authorities. The permit in question expired on September 15 2024.
Analysts at Galaxy Futures noted that the cancellations are unlikely to have a direct impact on current lithium supply, as none of the revoked licences relate to operating mines. Nevertheless, the announcement heightened market anxiety over longer-term availability, pushing lithium carbonate prices higher.
The latest move follows a broader clean-up of mining permits in Yichun that began in September. The bureau previously revoked six licences on November 27.
Lithium carbonate prices have been trending upward since August, after mining at CATL’s Jianxiawo mine was suspended due to the expiry of its mining licence. Strong demand from the energy storage sector has provided additional support to the market.
