Global Lithium Supply Shaken by CATL's Mine Suspension in China

On August 11, 2025, Contemporary Amperex Technology Co. Ltd. (CATL), the world's largest battery manufacturer, announced the suspension of operations at its Jianxiawo lithium mine in Yichun, Jiangxi province, following the expiration of its mining license on August 9. The company is actively seeking to renew the license and aims to resume production promptly upon approval.

The Jianxiawo mine has an annual production capacity exceeding 46,000 metric tons of lithium carbonate equivalent, accounting for approximately 3% of the projected global supply for 2025. The suspension has led to an 8% surge in lithium carbonate futures on the Guangzhou Futures Exchange, reaching the daily price limit. Additionally, shares of lithium producers, including Ganfeng Lithium and Tianqi Lithium, experienced significant gains in response to the news.

This development is part of a broader effort by Chinese authorities to address overcapacity in industries such as lithium and solar panel manufacturing. Analysts suggest that the suspension may help alleviate oversupply pressures in the lithium market, which has seen prices decline nearly 90% from their 2022 peak due to a slowdown in demand and oversupply.

The suspension of operations at the Jianxiawo mine underscores the delicate balance of the global lithium market and highlights the potential impact of regulatory actions on commodity prices and supply chains. In response to the suspension, lithium carbonate futures on the Guangzhou Futures Exchange surged by 8%, reaching the daily price limit. Shares of lithium producers, including Ganfeng Lithium and Tianqi Lithium, experienced significant gains, with Ganfeng's Hong Kong-listed stock rising around 10% at the open.

This development is part of a broader effort by Chinese authorities to address overcapacity in industries such as lithium and solar panel manufacturing. Analysts suggest that the suspension may help alleviate oversupply pressures in the lithium market, which has seen prices decline nearly 90% from their 2022 peak due to a slowdown in demand and oversupply.

The suspension of operations at the Jianxiawo mine underscores the delicate balance of the global lithium market and highlights the potential impact of regulatory actions on commodity prices and supply chains.