CATL Halts Production at Major Lithium Mine in China... Futures and Related Stocks Surge

On August 11, Bloomberg and other outlets reported that Contemporary Amperex Technology Co. Limited (CATL), the world’s largest battery manufacturer, has temporarily halted production at a major lithium mine in Jiangxi Province, China. Following this news, lithium futures prices and related stocks surged on the same day.

According to Bloomberg, CATL informed investors that it had suspended mining operations at the Zhenxiao mine in Lichunshi, Jiangxi Province.

Lithium mine in Changjisheng, Ichunshi. Photo by Reuters Yonhap News

CATL told investors that it is seeking to renew the expired mining license, but did not provide further details. The company added that this suspension is expected to have little impact on its overall operations.

The previous day, Bloomberg, citing multiple sources, reported that CATL had decided to halt operations at the Zhenxiao mine for at least three months and had communicated this decision internally and to nearby affiliated smelters. Chinese media outlets such as Securities Times also reported that CATL’s mining permit for the Zhenxiao site expired on August 9, 2025, and that operations ceased as of August 10.

The Zhenxiao mine accounts for about 3% of global lithium production.

This has led to speculation that Chinese authorities may suspend other projects beyond CATL’s lithium mine as part of efforts to address overproduction across the economy. Authorities have recently reiterated their intention to manage and crack down on overproduction and cutthroat price competition. The industry is closely monitoring regulatory measures at other mines near Lichunshi, as authorities appear to be delaying mining permit renewals to control supply.

The lithium industry has been struggling due to a global supply glut and a slowdown in electric vehicle demand. Lithium prices, which peaked in 2022, have since plummeted by nearly 90%.

After the news broke, lithium futures prices and related stocks all rose sharply. According to Bloomberg, lithium carbonate futures on the Guangzhou Futures Exchange hit their daily price limit of 8%, while shares of lithium and other mining companies surged in Australia.

Mattie Zhao, co-head of China research at Bank of America, told Bloomberg TV, “In the short term, this means there is a very high possibility of a significant increase in lithium prices.” Zhang Weixin, an analyst at China Futures, said, “The situation at CATL will not change the overall oversupply structure in the market,” but added, “However, if production disruptions extend to other mines in Lichunshi after September 30, lithium prices could rise even further.”

This content was produced with the assistance of AI translation services.