- CATL’s Ya’an lithium salt project disclosure signals an upstream push to secure raw materials amid a steep lithium-price downturn and intensifying supply competition from peers.
- The RMB 1.4B ($208.7M) project targets annual outputs of 40,000 tons lithium carbonate, 30,000 tons lithium dihydrogen phosphate and 130,000 tons sodium sulfate.
- The move targets battery makers and large miners, but faces execution risks from early-stage approvals, unclear funding and timelines, mining permits and long ramp-up to stable output.
CATL is continuing to expand its upstream lithium salt footprint despite a sharp decline in lithium carbonate prices.
An environmental impact assessment disclosure showed that CATL plans to develop a lithium salt production base in Ya’an, Sichuan province.
The project involves total investment of RMB 1.4B ($208.7M) and will include annual capacity of 40K tons of lithium carbonate, 30K tons of lithium dihydrogen phosphate and 130K tons of sodium sulfate.
The project remains in an early stage. The disclosure is only the first round of environmental assessment information, with details such as construction timeline, funding sources, raw material supply plans and expected production start date yet to be announced. It does not indicate that construction has officially started.
The announcement comes as lithium carbonate prices continue to retreat.
On Sept. 16, the main lithium carbonate futures contract LC2701 on the Guangzhou Futures Exchange closed at RMB 125.82K per ton, down 23.9% from its early September peak of RMB 162.86K per ton. Compared with the around RMB 210K-per-ton high in May, lithium carbonate futures prices have fallen more than 40% in four months.
Spot prices are also under pressure, with battery-grade lithium carbonate averaging around RMB 127.6K per ton on Sept. 16. For CATL, however, advancing lithium salt projects during a low-price cycle could improve long-term control over critical raw materials.
CATL has already secured multiple lithium resource projects across China.
Among them, the Jianxiawo lithium mine in Yichun, Jiangxi province, is one of its most closely watched assets. The mine is among the world’s largest lepidolite deposits, with designed lithium carbonate capacity of around 100K tons per year at full production.
The project was previously suspended due to mining-related approvals and other issues. After related environmental assessment procedures resumed in August, the latest disclosure was later withdrawn.
CATL also controls the Sichuan Yajiang Snowway lithium mine project through a wholly owned subsidiary. The project recently completed environmental assessments and received provincial approval for construction land, moving into the preparation stage for actual development.
The mine is designed to process 1.5M tons of raw ore annually and is the first large-scale mining project in the area to receive approved construction land. However, it will still take time before the project reaches stable production.
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