Chinese inventories are being drawn down, spot prices have increased, and mining companies are acting as though the market has reached its bottom. Mineral Resources is expected to invest AUD 490 million in expanding its lithium operations in Australia, while others are speaking of a “lithium renaissance”.
In Europe, momentum is also building. Finland has launched what could become Europe’s largest lithium mine, strengthening the European battery supply chain.
This aligns with the EU’s broader ambition under the Critical Raw Materials Act to secure access to critical mineral resources and reduce dependence on external suppliers. The Finnish project therefore contributes to efforts to build a more resilient lithium-ion battery supply chain, including demand from EV battery recycling companies and energy storage systems.
But then rumours of a mine restart in China push the Li price downwards again, demonstrating that this is definitely not a stable market.
The key takeaway is not that lithium is “back”, but that critical mineral supply chains can shift rapidly and that business models based on stable commodity assumptions are inherently vulnerable.
The challenge is increasingly shifting from mineral availability to the stability of processing systems and their inputs, which have themselves become strategic risks in the global battery supply chain.
Tensions around the Strait of Hormuz continue to affect supplies of sulphur and sulphuric acid, with downstream impacts on copper and nickel production. This illustrates the fragility of systems dependent not only on raw materials, but also on chemicals, energy, logistics, and industrial processing.
This is particularly relevant for lithium recovery and refining, where reagents such as sulphuric acid remain central. Vulnerability therefore extends beyond feedstocks into the lithium-ion battery supply chain itself.
Refining and processing in the midstream segment remains the key bottleneck, including across EV battery recycling plants, wind turbine recycling companies, and broader critical mineral processing infrastructure. Europe does not simply need more capacity. Existing systems remain costly, sensitive, and dependent on fragile inputs.
Instead, Europe needs a more resilient processing architecture, including technologies such as molten salt processes, improved lithium-ion battery recycling technology, and more efficient handling of black mass battery streams. These approaches can reduce chemical intensity and improve feedstock flexibility across the battery supply chain.
Several governments are already acting. The Quad partners - Japan, India, the United States, and Australia - have launched a critical minerals initiative worth up to USD 20 billion covering mining, processing, and recycling. Similar funding initiatives are also emerging in the United States to address gaps in the critical mineral supply chain.
This raises a clear question: where is Europe’s equivalent speed and coherence?
Europe has the need, the regulation, and the strategic vulnerability, but funding and execution remain fragmented. The Critical Raw Materials Act highlights that capital alone is not enough; enabling regulation, permitting, and industrial policy are equally critical.
Finland’s lithium project signals positive momentum in securing access to critical mineral resources. However, access alone is not sufficient.
The real challenge lies in building scalable processing capacity across the lithium battery supply chain that can withstand volatility and reduce dependence on fragile midstream structures. Without this, new European mining projects risk replicating the same bottlenecks they aim to solve.
If Europe is to strengthen its raw material sovereignty, the focus must shift from extraction alone to building efficient lithium recovery, advanced recycling technologies, and resilient processing infrastructure across the EV battery recycling ecosystem.
