The global lithium industry is reeling from an unprecedented collapse in lithium carbonate prices, with a staggering 90% plunge from its 2021 peak of ¥600,000 ($84,000) per ton to below ¥60,000 ($8,400) today. This seismic shift signals more than temporary market volatility—it reflects a fundamental reversal of supply-demand dynamics that is forcing companies to radically rethink their strategies.

From Boom to Glut: The Supply-Demand Reversal

First-quarter 2023 data reveals a paradoxical market: global lithium salt production rebounded 23%, while China's April lithium carbonate imports surged 56.3% to 28,000 tons. Yet this apparent recovery masks a harsh reality—electric vehicle battery installations dropped 4.3% quarter-over-quarter. "The party's over for easy growth," says an industry analyst. "China's NEV market expansion has slowed dramatically, catching many players off guard."

The price freefall has breached the ¥70,000/ton survival threshold for processors. Meanwhile, technological advances—particularly in salt lake extraction—are driving costs down further. Tibet Mineral Development's Zhabuye Salt Lake project targets production costs of just ¥32,000/ton, while Sinomine Resource pushes toward ¥60,000 through innovation. This relentless cost compression threatens to erase traditional price floors.

The Coming Lithium Tsunami

Market researchers project global lithium surpluses of 224,000 tons (2024), 265,000 tons (2025), and 207,000 tons (2026), fueled by expanding salt lake capacity and revived mica mining. The industry is transitioning from hard-rock dominance to a dual-track "salt lake + ore" pricing regime—a shift that will reshape the entire battery value chain.

"The writing is on the wall," warns a Minmetals Securities analyst. "Salt lake operators hold decisive cost advantages, while many Jiangxi mica miners face 'expand-to-die' economics." This divergence is accelerating industry consolidation, with 30% of lithium processors nearing shutdown thresholds. Models suggest half could face bankruptcy within two years if prices hit ¥50,000/ton.

Corporate Survival Strategies

Market leaders are deploying radically different playbooks:

• Ganfeng Lithium is building closed-loop recycling networks to hedge against raw material volatility.

• Tianqi Lithium is securing overseas reserves to ensure global supply chain control.

• CATL is aggressively developing sodium-ion batteries as a lithium alternative.

Meanwhile, battery giants like BYD and Guoxuan High-Tech are back-integrating into upstream lithium supply through long-term contracts—locking in today's depressed prices against future rebounds.

Technological Disruption Looms

The industry faces potential paradigm shifts beyond lithium's boom-bust cycle:

• Sodium-ion batteries , with lower material costs, are nearing commercial viability.

• Solid-state batteries have achieved energy densities exceeding 500Wh/kg—a potential game-changer.

"We're entering a three-year lithium value recalibration," notes a battery technology analyst. "Companies that fixate on today's price war risk missing tomorrow's technology war."

As the industry braces for prolonged turbulence, adaptability and innovation—not just scale—will determine survival. The lithium gold rush has ended; the battle for post-lithium supremacy has begun.