[ACCI-CAVIE] Lithium-rich African countries, including Zimbabwe and Namibia, are trying to develop processing and refining industries to capture more profits from the global demand for the essential battery material.
As the auto industry shifts towards electric vehicles – spurred on by proposed bans on cars using fossil fuels from the end of this decade – lithium prices and demand have soared.
China, the world’s top lithium refiner and a leading producer, dominates the supply chain, but Western governments and international companies are trying to challenge that. They see Africa’s lithium reserves as an opportunity.
For their part, African countries are determined to retain more value of their resources than they have in the past, which means not just mining the minerals, but also processing them before export, which is referred to as beneficiation.
“We are saying to ourselves, if you have got the minerals that everybody wants now, you need to make sure that at least you mine those minerals differently and not in the usual manner,” Namibia’s Mines Minister Tom Alweendo told Reuters in an interview on the sidelines of the Investing in African Mining Indaba in Cape Town this week.
“We are going to insist that all lithium mined within the country has to be processed in the country,” Alweendo said.
Africa’s lithium production is set to rapidly increase this decade. From 40 000 tons this year, it will probably produce 497 000 tons in 2030, commodities trader Trafigura estimates, with the bulk of that lithium coming from Zimbabwe.
Prices for lithium more than doubled last year as demand from the electric vehicle industry outstripped supply.
In December 2022, Zimbabwe imposed a ban on raw lithium exports, a measure aimed at stopping the smuggling of the ore and to spur mines on to process it in the country.
The country’s Mining Minister Winston Chitando said:
We made plans to only allow the export of concentrates.
“Because of the ban, other investors have come in wanting to mop up lithium ores and develop them to concentrate stage.”
‘POISON OF GREED’
Mining has often been linked to the exploitation of workers or environmental degradation by foreign companies. During his visit to the Democratic Republic of Congo last month, Pope Francis condemned the “poison of greed” for mineral resources that has exacerbated the conflict in the country’s east.
The latest effort by African governments is far from the first time they have resolved to retain more value of their mineral wealth, which ultimately should boost tax revenue, encourage new businesses and add jobs.
The global transition from fossil fuels to greener energy is giving a sense of urgency, although many obstacles remain, most notably insufficient electricity supply.
As companies and investors around the world focus on the goals to reduce carbon emissions and increase supplies of the minerals that should help, those involved are reconsidering projects they may have previously overlooked.
“These are really unique times we are living in, with this whole transition to a clean energy future, and Ghana could be part of this story,” said Len Kolff, interim CEO at Atlantic Lithium.
The company’s Ewoyaa mine project, 100km from the capital Accra, is set to be the first lithium producer in the west African country. US firm Piedmont Lithium has signed a deal to get 50% of the lithium produced.
Everybody is approaching us, like the whole who’s who on the Chinese list and now it’s all the Western original equipment manufacturers.
In Mali, Leo Lithium Goulamina mine plans to take advantage of high prices to export two 30 000-ton shipments of lithium ore by the end of this year, managing director Simon Hay said.
The proceeds would help to develop the project to allow for domestic processing, Hay said, with the first production – expected in the middle of next year – to be sent to Ganfeng Lithium in China.
By Clara Denina, Wendell Roelf and LB