Lithium carbonate is a lithium compound used in a range of industrial, technical and medical applications. As Rockwood Lithium notes, it is often “the first chemical in the production chain,” with other compounds such as lithium hydroxide being produced with subsequent steps if needed.
For this reason, investors will often see lithium production numbers broken down in terms of lithium carbonate equivalent. As with other lithium products, lithium carbonate may be produced from brines or from hard-rock deposits, although a few companies are also looking to develop clay-based lithium deposits.
Those interested in the lithium space will no doubt have seen plenty of references to lithium carbonate in company reports. Here are a few key points to keep in mind:
-- Lithium is used for much more than just lithium-ion batteries
-- Not all lithium carbonate is created equal
-- Lithium hydroxide is becoming more and more popular for use in the manufacturing of lithium-ion batteries
Batteries and beyond
Batteries have generated most of the excitement in the lithium space as of late, with Tesla Motors’ (NASDAQ:TSLA) plans for a lithium-ion battery gigafactory still drawing plenty of investor attention. However, there is more to the lithium market than Tesla (it’s far from the only company building a lithium-ion battery megafactory), and the market for lithium goes well beyond batteries as well.
Specifically, lithium carbonate is used in ceramics, glass, cement and aluminum processing. While the battery market is certainly growing, the US Geological Survey (USGS) estimates that glass and ceramics still made up roughly 32 percent of global end-use markets in 2015.
Types of lithium carbonate
Not all lithium carbonate is made equal, and end products must meet specific requirements to be used in different applications. For example, battery-grade lithium carbonate can be used to make cathode material for lithium-ion batteries, but most contaminants must be removed in order for the material to be considered battery grade.
This type of lithium is used in applications for glass and ceramics. It’s also worth noting that lithium is used in the form of ore concentrates in industrial applications rather than as lithium carbonate or hydroxide, according to the USGS.
Lithium carbonate vs. lithium hydroxide
Along with all of the excitement surrounding lithium-ion batteries, lithium hydroxide has also been getting more attention than its counterpart, lithium carbonate. Both are used to produce cathode material for lithium-ion batteries, and hydroxide is more expensive. However, it can also be used to produce cathode material more efficiently and is actually necessary for some types of cathodes, such as nickel-cobalt-aluminum oxide (NCA) and nickel-manganese-cobalt oxide (NMC).
As Jean Francois Magnan, technical manager for Nemaska Lithium (TSXV:NMX), explained in an interview last year, “because hydroxide decomposes at a lower temperature, it accelerates the process. It uses less heat, less energy, so you produce more cathode material with less energy, and you can still use the same equipment.”
Certainly, lithium hydroxide is expected to be used in the battery megafactories of the world over lithium carbonate. In recent years, rising demand from the battery space has raised concerns of a lithium hydroxide shortage. At least two companies — Nemaska, mentioned above, and Neometals (ASX:NMT) in Western Australia — are looking to cut out the middleman and produce lithium hydroxide directly from spodumene concentrates.
That might not sound like good news for lithium carbonate, but as mentioned above, the material still has plenty of uses beyond batteries. And since it’s still a precursor to lithium hydroxide in most cases, lithium carbonate could still have a place in the lithium-ion battery supply chain.
Don’t forget to follow us @INN_Lithium for more updates!
Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Nemaska Lithium is a client of the Investing News Network. This article is not paid-for content.
This article was originally published by the Investing News Network on November 17, 2015.