The need for more lithium to provide the batteries in electric vehicles and a growing number of electronic gadgets has made this material essential for advanced industrialised nations like the UK to get their hands on.

In addition, there is a need for it to be processed, something that, until recently, was almost exclusively the preserve of China, posing potential geopolitical risks over control of supplies of the material. China had also moved to secure supplies through economic agreements with various countries with large lithium deposits, from Africa to Latin America.

However, the threat has somewhat eased, not least because abundant supplies of lithium have been found in various countries, including Australia, the United States and even here in the UK, in Cornwall and County Durham. At the same time, significant progress has been made in building up contract processing facilities.

Lithium Prices Expected To Stabilise

On all these counts, the latest developments offer heartening news. In the first case, progress in discovering accessible lithium resources around the world has been arguably too successful, to the point at which supply and production exceeded current needs. This glut has led to an 80 per cent fall in the global price of lithium in the last couple of years.

Were this situation to persist, progress in developing the lithium sector at all stages from mining through refining to battery manufacturing could be held back.

However, the latest reports from analysts point to a rapidly stabilising picture. Several mines have closed and there has been a high take-up of electric vehicles in China, with these factors greatly reducing the oversupply.

The result of this should be stabilised prices in 2025, which is just what the industry needs, not least as it means further development can take place while demand gradually rises in the knowledge that, eventually, this will make it economically viable to reopen closed mines and start up new ones.

Recycling Boost To UK Supply

Secondly, the development of the UK’s own supply chain has been boosted by a new partnership between chemical firm HELM and recycling firm Altinium, Let’s Recycle reports. A memorandum of understanding agreed between the two firms will “work together to develop a sustainable domestic supply chain” for the material in the UK.

This is expected to involve agreements on the recovery of lithium from used batteries, which can then be recovered, processed and put back to use again, reducing the need to mine the material afresh every time.

Director of partnerships and strategic sourcing at HELM Energy Materials Nerve Cruz said: “The planned alliance underlines our focus on specialised solutions and the much-needed approach of recycling existing resources to support a sustainable supply chain for lithium, especially in Europe and the UK.” 

More stable prices and new partnerships that help maximise the existing lithium resources through more recycling of the material already in use are both highly positive steps.

UK To Sign Rare Earths Deal With Saudi Arabia

So too is the prospect of the UK having more international agreements in place with other countries from which lithium and other rare earth materials can be secured, providing security against geopolitical events and situations that could jeopardise supplies from countries like China.

The latest agreement to be signed by the UK will be a deal with Saudi Arabia, helping secure supplies of lithium alongside other materials such as copper and nickel. From a Saudi perspective, there is an estimated $2.5 trillion (£2 trillion) worth of mineral deposits within its borders, providing a huge potential source of wealth as the world transitions away from oil.

UK firm Cornish Lithium, which plans to open Britain’s first lithium mine soon, will be in the British delegation involved in talks about the deal, which will be signed alongside wider negotiations for a trade agreement between the two countries.

British Industry minister Sarah Jones is set to say at the forum that critical minerals have a crucial role to play in the development of the latest technologies in the UK, stating: “In the global race for economic growth, and in an increasingly uncertain world, the UK must secure supplies of these critical minerals.”

Securing The Future

The Saudi deal will not be the first of its kind. Last November, the UK government signed up to a strategic partnership on critical minerals with Indonesia, with the mining, processing, manufacturing and recycling of such materials all part of the agreement.

Such developments may provide considerable certainty for the UK at a time of great uncertainty across the globe, with the new Trump administration threatening tariffs on all manner of imported goods (perhaps including lithium) in a way that could impact supply and prices, as well as ongoing geopolitical tensions in various parts of the world.