Chinese Mining Companies Collaborate with Zimbabwe on Lithium…

Chinese mining giants Zhejiang Huayou Cobalt Co. and Tsingshan Holding Group Co. are collaborating with Zimbabwe’s Kuvimba Mining House to develop a lithium mining project in Sandawana. Despite a 90% decline in lithium prices since late 2022, they plan to invest up to $300 million to construct a facility expected to produce 500,000 tons of lithium concentrate annually. The firms’ confidence in a price recovery by 2026 highlights the ongoing demand for lithium amid increased production in Africa.

Chinese mining entities Zhejiang Huayou Cobalt Co. and Tsingshan Holding Group Co. are advancing their collaborative lithium mining initiative in Zimbabwe alongside a state-owned enterprise. Despite a significant downturn in lithium prices, both companies continue to engage in lithium-related projects within the country, currently undertaking a feasibility assessment for the construction of a mine and processing plant at Sandawana, situated in southern Zimbabwe. This information was corroborated by the Chief Executive Officer of Kuvimba Mining House, the asset holder, who had previously announced the partnership in July without disclosing the identities of the partners. Zimbabwe has emerged as a pivotal contributor to the global lithium market over the past two years, particularly following a price surge in 2021 and 2022 that attracted substantial interest from Chinese firms keen to exploit the nation’s abundant lithium resources. Despite lithium prices dropping nearly 90% since late 2022 due to a supply influx overshadowing the expected demand for electric vehicles, Chinese companies are steadfast in securing the necessary raw materials for their domestic refining operations. The two Chinese firms are poised to invest between $250 million and $300 million in developing their lithium mining and processing operations, which are projected to yield approximately 500,000 tons of lithium concentrate each year, as narrated by Trevor Barnard, the acting Chief Executive Officer of Kuvimba Mining House. He is optimistic about the future of lithium prices, predicting a gradual increase within the next year, with a robust recovery expected around 2026 and 2027 as current production surpluses begin to convert into deficits. While lithium mining and exploration initiatives are proliferating across various nations in Africa, including Namibia, Mali, Ghana, and the Democratic Republic of the Congo, these projects remain relatively small in comparison to those occurring in the Americas, Australia, and Europe.

The landscape of the global lithium market has significantly evolved, particularly as the demand for electric vehicles accelerates. As lithium is a critical component in the batteries that power these vehicles, countries rich in lithium reserves, such as Zimbabwe, have garnered international attention. The involvement of Chinese companies like Zhejiang Huayou Cobalt and Tsingshan Holding showcases the strategic moves by foreign entities to secure essential materials, especially during fluctuations in market prices.

In conclusion, the partnership between Zhejiang Huayou Cobalt Co. and Tsingshan Holding Group Co. with Kuvimba Mining House represents a robust commitment to the lithium mining sector in Zimbabwe. Despite facing a dramatic decline in lithium prices, these companies exhibit optimism and determination towards establishing a successful operation that could expand the country’s role in the global lithium supply chain. The anticipated recovery of lithium prices, coupled with significant investments, affirms the project’s viability and potential prosperity.

Original Source: www.newzimbabwe.com