• As Walmart announces plans to expand the EV fast charging network, Tesla announces more China plans.
  • USCM CEO Darren Collins notes the importance of Lithium to America's global strategy.
  • Several countries including Mexico and China are becoming increasingly protective of their Lithium
Lithium Shortage Looms: Tesla Pivots to China;
Lithium Shortage Looms: Tesla Pivots to China; Are Firms like US Critical Metals Vital to US Strategy Image design by Adriaan Brits

The International Energy Agency (IEA) warns that the world could face lithium shortages by 2025. The importance of lithium has been highlighted by various global leaders, with some in the energy strapped EU declaring lithium "will soon be even more important than oil and gas." Tesla has recently begun producing lithium batteries in China, a move that will undoubtedly benefit the vehicles it sells in China and potentially elsewhere in the world. However, the US and China remain strategic competitors, and China may restrict lithium exports to the US in retaliation for US sanctions limiting chip technology exports to China. This could significantly impact the US automaker market and provide China with even more leverage in the country's quest for global dominance.

In the quest for power so green, America's lithium reign must be seen.

The importance of America's ability to produce its own lithium has never been greater. Besides the fact that ESG investing will suffer without ample lithium, a more important issue is on the horizon.Researchers argue that heavy reliance on China and other countries is a matter of national security. Companies like US Critical Metals, which explore for new sources of lithium in the US, may be crucial for US automakers to maintain global dominance and supply the domestic market with electric vehicles (EVs). This is best exemplified by General Motors commitment to invest $650 million in Lithium Americas.

Darren Collins, the CEO of USCM says "I believe that lithium has become one of the most significant commodities of the modern era, due to the rise of EVs and related energy storage needs. It could be that America's leadership on the global stage is closely linked to its ability to discover, develop and produce from domestic lithium sources, thus USCM is committed to playing a vital role in this endeavor."

Drivers of Lithium Demand in the US:

Walmart's announcement to invest heavily in the expansion of EV fast-charging stations is not surprising. Auto manufactures are continuously expanding their EV lineups, including Volkswagen, which now produces the most affordable EV in America. All these new and exciting products coming to market are driving EV adoption rates. As Americans transition from fossil fuels to renewable sources, lithium demand has the potential to soar. However, America is also a vehicle exporter. To challenge the global car market, it must compete with China in lithium production and sourcing, or risk dependence on China to sustain the industry.

Don't Expect Tesla to Shoulder the Lithium Burden for America:

Some may wonder why Tesla has opened a large battery production plant in China, given the US government's early funding support. In April 2022, Elon Musk suggested getting directly involved in lithium mining, citing rising commodity costs in a tweet. Hedging his bets in China seems like a genius move by Musk. German and American automakers are encroaching on Tesla's domestic market, and China could restrict the American market's access to lithium products in a tit for tat response. Meanwhile, China and the Global South, including Asia, may offer untapped markets for Tesla. If future GDP forecasts hold, China and India could become the largest EV markets in the next 20 years. With a stroke of luck, China might even trust Tesla enough to open the door for Twitter, which could make it one of the best investments Musk has ever made.

Don't Expect Mexico to Shoulder the Burden Either:

Mexican President Andres Manuel López Obrador recently warned that if a Congressional reform on energy was not approved by next week, he would utilize a Supreme Court ruling to pass a new law on electric power. This law would increase government oversight and control while eliminating mining concessions for lithium. What is happening in Mexico could easily happen in other major economies.

US Government Takes Lithium Seriously:

US lawmakers have already pushed for legislation to create a strategic rare earth reserve by 2025 and develop domestic sources. According to the United States Geological Survey (USGS), China supplied 80% of the United States' rare-earth imports in 2019.

Now, Lithium has finally entered the agenda too: On March 31, US President Joe Biden invoked the Cold War-era Defense Production Act to ensure domestic lithium supply, citing dependence on foreign sources as a national security concern.

Clearly with governments taking Lithium seriously - investors might be about to do the same. Below are 6 American Lithium related stocks that may be of interest:

#1. US Critical Metals Corp. (USCMF)

USCM is focused on mining projects that will further secure the US supply of critical metals and rare earth elements, which are essential to fueling the new age economy. A significant percentage of the world's critical metal and rare earth supply comes from nations with interests that are contrary to those of the US. USCM intends to explore and develop mineral resources with near- and long-term strategic value to the advancement of US interests.

#2. American Lithium Corp. (LIACF)

American Lithium Corp. is a rapidly growing lithium exploration and development company focused on their flagship TLC lithium project in Nevada, USA. With a strong management team and strategic partnerships, the company is dedicated to creating sustainable value for its shareholders while meeting the growing demand for lithium. Its project aims to become a major producer of lithium in the US, addressing the market's increasing need for battery-grade lithium products.

#3. Livent Corporation (LTHM)

Livent Corporation is a global lithium technology company specializing in the production of high-performance lithium compounds. With a strong focus on sustainability, LTHM aims to provide solutions for the increasing demand for energy storage, electric vehicles, and portable electronics. The company's operations include mining, refining, and the production of lithium hydroxide and lithium carbonate. Livent's primary lithium production facility is located in Argentina, while its corporate headquarters and technology center are based in the United States.

#4. Lithium Americas Corp. (LAC)

Lithium Americas Corp. is a resource company focused on advancing lithium projects in the Americas. The company's primary projects are the Cauchari-Olaroz lithium project in Argentina, which is under construction, and the Thacker Pass lithium project in Nevada, currently in the permitting phase. LAC is dedicated to ensuring a sustainable and environmentally responsible lithium supply chain. Their projects aim to capitalize on the growing demand for lithium to support the transition to a low-carbon future.

#5. Piedmont Lithium Inc. (PLL)

Piedmont Lithium Inc. is an emerging lithium company focused on the development of its 100% owned Piedmont Lithium Project in North Carolina. The project's strategic location in the United States' lithium-ion battery supply chain positions the company to become a key domestic supplier of battery-grade lithium. Piedmont Lithium's vision is to establish a fully integrated lithium hydroxide business, encompassing mining, concentrating, and refining, to support the growing electric vehicle and energy storage markets.

#6. E3 Metals Corp. (ETMC)

E3 Metals Corp. is a lithium development company that holds one of the world's largest lithium resources in its Alberta Petro-Lithium Project. The company's proprietary Direct Lithium Extraction (DLE) technology aims to produce high-purity, battery-grade lithium products with minimal environmental impact. E3 Metals is dedicated to advancing its lithium extraction and refining projects to meet the increasing demand for lithium products in the electric vehicle and renewable energy sectors.

#7. Albemarle Corporation (ALB)

Albemarle Corporation is a global specialty chemicals company and one of the world's largest lithium producers. With a diversified lithium portfolio, ALB operates in three main segments: lithium, bromine, and catalysts. The company's lithium segment encompasses the extraction, processing, and refining of lithium, with operations in the United States, Argentina, Chile, and Australia. Albemarle's lithium products are essential components in various industries, including electric vehicles, energy storage, and consumer electronics.

#8. Century Lithium (CTLY)

Century Lithium is an emerging lithium company with an extensive portfolio of lithium projects in North America. The company's goal is to establish itself as a leading lithium producer by capitalizing on the growing demand for lithium-ion batteries. With a focus on strategic acquisitions and responsible exploration, Century Lithium is committed to creating value for its shareholders and contributing to the green energy transition.

#9. Noram Lithium (NRM)

Noram Lithium is a junior exploration company with a primary focus on lithium resource development. The company's flagship project, Zeus, is located in the prolific Clayton Valley of Nevada, which is known for its lithium-rich brines. Noram Lithium is dedicated to advancing its lithium projects through a combination of exploration, development, and strategic partnerships, with the ultimate goal of becoming a significant lithium producer in the United States.

Conclusion: In the race for lithium's might, those who conquer its domain shall harness the world's energy

The world may have been heavily distracted by the Russia / Ukraine war and food as a commodity - just think about the grain corridor negotiated by Turkey. However, Lithium has been touted as instrumental to national security across the G20. Europe may love it more because there are no Lithium pipelines that can be blown up. The price rises in Lithium over the past 10 years outpaced that of many foods and commodities. Thus the new potential Texas debated gold backed digital currency that Peter Schiff drew attention to, may as well have a sister currency backed by Lithium, a.k.a. "The new white gold".