Lithium Prices in China Surge as Yichun Plans to Revoke 27 Mining Licences
SHANGHAI — Lithium prices in China rose sharply on Wednesday after authorities in the country’s main lithium-producing hub announced plans to revoke dozens of mining licences, triggering investor concerns over future supply.
The most-traded lithium carbonate contract on the Guangzhou Futures Exchange climbed to 109,860 yuan (US$15,592) per metric ton during the session, its highest level since June 2024. Prices later eased slightly but still closed up 7.61% at 108,620 yuan.
The Bureau of Natural Resources of Yichun, a key lithium-producing city in Jiangxi province, said it intends to cancel 27 mining permits following a public consultation period that runs until January 22. The announcement was published on the bureau’s official website on Friday.
According to the notice, all of the affected licences had already expired—some more than a decade ago—and most were issued for ceramic clay or limestone mining rather than active lithium operations.
One of the revoked permits, identified as a lithium-bearing ceramic stone mine, was held by Jiangxi Special Electric Motor.
The company said on Wednesday that it had formally submitted an objection to the local authorities. The permit in question expired on September 15, 2024, according to the bureau.
The Yichun Bureau of Natural Resources did not immediately respond to a request for comment.
Analysts at Chinese brokerage Galaxy Futures noted that the licence cancellations are unlikely to have a direct impact on near-term lithium supply, as none of the permits covered operating mines.
Nevertheless, the announcement unsettled markets by raising concerns about longer-term supply availability, contributing to the rally in lithium carbonate prices.
The latest move follows a broader effort by local authorities in Yichun to clean up expired or inactive mining licences. Since September, the bureau has revoked multiple permits, including six cancellations announced on November 27.
Lithium carbonate prices have been on an upward trend since August, after mining at CATL’s Jianxiawo mine was suspended due to the expiration of its mining licence.
Strong and growing demand from China’s energy storage sector has provided additional support to prices.
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