Lithium prices and reserves rose on Monday (11.08.2025), following the decision of Contemporary Amperex Technology, the giant in the field of batteryto discontinue the operation of a large mine to Chinatriggering speculations that Beijing may suspend other projects as part of its attempt to tackle surplus production capacity.
Tianqi Lithium rose up to 19% in Hong Kong, while Ganfeng Lithium Group rose 21% and Australian lithium mining companies recovered, after CATL’s confirmation that it had closed the mine in Jiagki, China. Metal prices for batteries on the Guangzhou Stock Exchange have risen to the daily threshold.
The fate of the Catl mine – the largest at the China Lithium Center in Yichun – was closely monitored for weeks, amid speculations that authorities would not renew its permission. The mine accounts for about 6% of world production, according to Bank of America, while other mines in the area account for at least 5%.
“I think this means that the price of lithium will have a great rise in the near future,” said Matty Zhao, a co -director of China’s shares research on the lender, in an interview with Bloomberg.
Lithium producers have faced a global over -supply that has deteriorated by the decline in demand for electric vehicles, including the abolition of President Trump incentives in the US. In China, the so -called anti -downgrade campaign has fueled speculations for a possible suppression of a sector that clearly suffers from over -supply.
Catl, the largest battery producer in the world, confirmed the closure of the mine on Monday morning, saying it seeks to renew the expired permit, without giving further details. The operation will be suspended for at least three months, according to information given to Bloomberg on the weekend competent sources, after the expiry of the mining license on August 9th.
The Chinese company said the interruption would have a slight impact on its overall activities, and its shares increased by 2.8% in Hong Kong, before losing about half of their profits.
“For CATL, we do not expect any significant impact on the operation of batteries production from the suspension of the mine,” said Youtzin Hsiao, head of China’s strategic shares at Macquarie Capital. “The concern of the suspension of the mine is less concerned with CATL and more whether the wider lithium supply chain will face a reduction in production capacity and whether it is coordinated through actions by the Chinese government.”