Musk urges miners to produce more lithium – as it’s a licence to “mint money”

Elon Musk, founder & CEO, Tesla

TESLA founder Elon Musk urged more entrants to the mining sector saying that producing lithium for use in battery electric vehicles was a license to “mint” money.

“I’d like to once again urge entrepreneurs to enter the lithium refining business. The mining is relatively easy, the refining is much harder,” Musk was quoted by Bloomberg News as saying. “You can’t lose, it’s a license to print money.”

China accounts for more than half of all existing lithium refining capacity, though suppliers are adding projects in other hubs, said Bloomberg News.

“If our suppliers don’t solve these problems, then we will,”  Musk said.

Constraints on availability of lithium that have sent prices surging aren’t the result of scarcity of raw materials, but because of limited global capacity to deliver ultra-high purity battery-grade hydroxide and carbonate chemicals into battery supply chains, he said.

Lithium carbonate prices in China have jumped almost 450% in the past year, said Bloomberg News.

China also has three-fourths of the lithium-ion battery mega-factories in the world, according to the International Energy Agency. Given that auto manufacturers have set down ambitious growth targets for EVs – the world’s largest car manufacturer, Toyota, says it aims to sell 3.5 million EVs a year by 2030 – the West is at risk of falling short.

It is currently far behind in the processing stakes: only 1% of global lithium is mined and processed within its borders, says the US Geological Survey. As for raw production of the mineral, about 80% is mined in Australia, Chile and China.