KEY POINTS
- Zimbabwe expects stable lithium prices to support its $270 million deal.
- Sandawana mine plans to produce 600,000 metric tons annually.
- Chinese firms play a major role in Zimbabwe’s lithium investments.
Zimbabwe’s state-owned Kuvimba Mining House is optimistic about the recovery of lithium prices, believing it will justify their $270 million project with Chinese investors.
Speaking on Monday, Kuvimba CEO Trevor Barnard revealed that a deal with two Chinese companies is expected to be finalized this month, paving the way for the development of a major lithium concentrator at the Sandawana mine.
This is coupled with lithium prices which have declined 80 per cent from their increase in November last year, due to supply glut and slowing down of EV markets.
However, according to the reports, analysts expect it to stabilize given the strong EV sales in China and reduced mining output in some mines.
Lithium market forecast sparks optimism
Kuvimba remains bullish about the long-term viability of lithium, with Barnard expressing confidence in the resource quality and its potential.
“The Sandawana project is a solid investment because of its exceptional resource size and quality,” he noted.
The proposed lithium concentrator is anticipated to be processing an average of 600,000 metric tons per year; which makes it very central in Zimbabwe’s effort to establish its position in the international lithium market.
Chinese companies have already invested over $1 billion in Zimbabwe’s lithium sector since 2021, positioning the nation as Africa’s largest producer of the mineral.
China’s role in Zimbabwe’s lithium growth
Zimbabwe has attracted investment from several Chinese companies in lithium mining; Zhejiang Huayou Cobalt, Sinomine Resource Group and Chengxin Lithium Group.
This partnership corresponds with China’s strategies that seek to earn strategic control of the international battery value chain and boost the export capacity in Zimbabwe.
According to Reuters, Barnard acknowledged that while lithium prices are unlikely to return to the record highs of 2022, they remain optimistic about strong demand.
“The 2022 spike was a bubble driven by positive sentiment, but we’re confident in steady growth moving forward,” Barnard explained.
The country is counting on these endeavors to fuel economic growth and improve the status of the nation in the clean energy sector.
