CATL's Suspension of Chinese Lithium Mine Operations Shakes Global Market

On August 9, 2025, Contemporary Amperex Technology Co. Limited (CATL), the world's largest electric vehicle (EV) battery manufacturer, suspended operations at its Jianxiawo lithium mine in Jiangxi province, China, due to the expiration of its mining license. The mine contributes approximately 3% to the global lithium supply.

The suspension has had immediate effects on the lithium market. Lithium carbonate futures on the Guangzhou Futures Exchange surged by 8%, reaching 81,000 yuan per tonne, the highest level since November 2024. Shares of major lithium producers experienced significant gains:

• Albemarle Corp.: Shares increased nearly 16%, marking the largest intraday gain in four months.
• Piedmont Lithium: Shares rose by 18%.
• Lithium Americas Corp.: Shares surged by 14%.
• Sociedad Química y Minera (SQM): Shares advanced by 12%.

China's lithium sector is undergoing increased regulatory scrutiny. The revised Mineral Resources Law, effective July 2024, centralizes mining permits under the Ministry of Natural Resources, eliminating previous loopholes. Analysts suggest that the suspension may signal China's efforts to address overcapacity in the EV battery sector.

CATL has stated that it is in the process of renewing its mining license and expects the suspension to have minimal impact on its overall operations.

The suspension coincides with China's revised Mineral Resources Law, effective July 2024, which centralizes mining permits under the Ministry of Natural Resources, eliminating previous loopholes. The law requires the integration of natural and artificial restoration efforts in mining areas, following principles of adapting to local conditions, scientific planning, systematic management, and reasonable utilization. Mining right holders are required to fulfill ecological restoration obligations if mining activities cause environmental damage, even after mining rights expire.

CATL has stated that it is in the process of renewing its mining license and expects the suspension to have minimal impact on its overall operations. The company is currently processing the license renewal application in compliance with relevant regulations and production at the Jianxiawo mine will resume as soon as the renewal is approved.