Chinese mining companies Zhejiang Huayou Cobalt Co. and Tsingshan Holding Group Co. are pushing forward with the development of a lithium deposit in partnership with a Zimbabwean state-owned company, despite the sharp decline in lithium prices.
Both firms are already involved in lithium projects in Zimbabwe and are now conducting a feasibility study ahead of plans to build a mine and processing plant at Sandawana, located in the southern part of the country, Bloomberg reported.
This was confirmed by the CEO of Kuvimba Mining House, which owns the asset and had earlier announced the deal in July without revealing the partners’ identities.
Zimbabwe has become a key player in the global lithium market over the past two years, following a surge in prices during 2021 and 2022. This boom has attracted huge interest and investment from Chinese companies, eager to capitalize on the country’s rich lithium resources.
Despite lithium spot prices plunging by nearly 90% since late 2022, as a surge in supply met weaker-than-expected demand for electric vehicles (EVs), Chinese companies remain determined to secure feedstock for their domestic refineries.
Huayou and Tsingshan plan to invest between $250 million and $300 million in the construction of their lithium mining and processing facility, which is expected to produce around 500,000 tons of lithium concentrate annually, according to Kuvimba’s acting CEO, Trevor Barnard.
Barnard anticipates that lithium prices will gradually rise over the next year, with a strong recovery projected for 2026 and 2027 as current production surpluses shift into deficits.
Despite current low prices, Barnard expressed confidence in the project’s viability, stating, “Our economics show that we will still be a profitable business even at the current pricing levels.”
Active lithium mining and exploration projects are soaring in different parts of the continent like Namibia, Mali, Ghana and the Democratic Republic of the Congo (DRC). However, these projects are still small relative to the number of projects developed in the Americas, Australia and Europe.
