Lithium Market: Demand Resilience, Supply Constraints, and Long-Term Investment Opportunities

Demand Drivers

China’s 2025 EV market shows strong resilience: first 8 months sales reached 962 million units (up 36.7% YoY) with 45.5% penetration, while PEV sales accounted for 64% (615.8 million units, up 46.1% YoY) [1]. PEV’s higher单车带电量 (33.9kWh) and storage demand growth further boost lithium consumption [2].

Supply Constraints

Lithium project cycles (3-5 years) lead to supply-demand mismatch: 2026 demand is expected to rise by 30% (190 million tons) vs supply growth of only 25 million tons, leading to a deficit [4]. Policy compliance and cost differentiation (low-cost salt lake producers vs high-cost ore miners) further restrict supply elasticity [3].

Market Perception vs Reality

Common misconceptions include overestimating short-term supply flexibility and underestimating storage demand. While lithium is abundant in nature, accessing it quickly is challenging due to long project lead times [5].

Investment Implications

Opportunities lie in low-cost salt lake lithium producers and EV/storage supply chain leaders like Ganfeng Lithium (SZ002460) and Tianqi Lithium (SZ002466) [6]. Rising lithium prices (potential突破15万元/ton) will benefit these players [5].