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In the previous industry report, it is mentioned that the supply of the raw materials of the lithium battery is insufficient to meet the demand. A coin has two sides. The innovation of direct lithium extraction technology is emerging due to the supply constraints concerns.
According to spectrum.ieee.org, the mismatch of the lithium demand driven by the EV boom and the supply deficit in the years coming will result in the disruption of the production and development of the battery-powered vehicles and energy storage systems. As shown in the graph below, EV demand occupies more than half of the total demand, and there is a requirement of about $14 billion investment to fill the finance gap for the pipeline of lithium production capacity as projected toward 2025, even though the pipeline is slightly over the estimated demand in 2025.
Considering lithium can be scarce in the long term which can be a decade, the technology of direct lithium extraction has been tested to meet the challenge of sustainability of the lithium mine resources. The new technology uses electricity and chemical processes to isolate and extract concentrated lithium. DLE, short for direct lithium extraction, is supposed to revolutionize the lithium industry, and many projects are ongoing in North America and European countries. It is estimated that the annual capacity of lithium hydroxide will be 15,000 to 20,000 metric tons by 2024, and the producers exploit the marginal reserves in a more energy-intensive way and more underground brines.