With a landscape worthy of a sci-fi movie, one of the largest mines in the United States is still waiting for permission to improve its operations. Once authorized, the improvements could increase the mine’s process capacity up to 10,000,000 per year, making this plant the “Mine of the Century”. With highly skilled employees with expertise to provide a secure supply of essential elements to customers around the world, this mine can also beat China in terms of production. But this feature from the market is delaying the plans to improve the plant.
The one of a kind: Meet the “Mine of the Century”
The increased tension between the United States and China is affecting the market around the world. After the North American President, Donald Trump, imposed some taxes on Chinese companies, the Asian country answered by stopping the import of seven rare earth elements, declaring a silent war against America, but the instability of the market is affecting one of the most relevant mining plants in the United States.
Located in Nevada, this site has a landscape worthy of a movie and the capacity to put the US in front of China once it is running at full capacity. Producing lithium since the 1960s, this mine is responsible for almost all the lithium source in the United States, which also represents 2% of the world’s lithium production.
High global demand for lithium and market instability are important factors for consideration
In Silver Peak, the Albemarle’s Silver Peak site is just waiting for the necessary improvements to become the “Mine of the Century”. But according to a recent statement made by Albemarle, the plans to build the largest U.S. lithium refinery are on hold due to the global glut of the metal and the instability in the market. With the plans delayed, those meant to boost the country’s mineral supply chain are at risk, and the United States might still be dependent on Chinese mines.
A $1.3 billion plan is on hold due to the lithium market’s instability
According to some sources, the US refines only a small amount of lithium and only has one mine where it is found, which is controlled by Albemarle. Last year, the company had plans to improve the operations and double the mine capacity, which would cost up to $1.3 billion. Due to the market’s instability and the devaluation of lithium due in part due to overproduction from Chinese companies, the plans are on hold.
As said by Albemarle CEO, Kent Masters, in a recent interview: “The math does not work today”.
“We have been wanting to build this Western supply chain. The economics just are not there to build that plant out in South Carolina”.
Besides the circumstances, the company still wants to improve the mining capacity, but the development of the western mines may need some support from the US government to achieve the same level as Asian mines. “I do not think private companies are going to be able to do it on their own,” states Albemarle’s CEO.
Lithium prices have fallen by 74% in the last two years, hindering yields
Despite the recent difficulties, lithium prices have fallen in the last two years, but still have some variations depending on the region and type. According to some sources, once the price is stabilized or the mines receive an incentive, production rates are expected to increase, and the Albemarle Silver Peaks would be close to matching Chinese mines in terms of lithium production. Meanwhile, a recent discovery in another North American region may also help the country surpass China in the production of metals and minerals.