Argentina could help the world by becoming a big lithium exporter

Picture a country in South America that is pro-business, is attractive to foreign capital and offers political stability for long-term investment. Most people would think of Chile. But when it comes to mining lithium, a light, salt-like metal used for batteries in electric vehicles and mobile phones, the country in question is its dysfunctional neighbour, Argentina. Better known for triple-digit inflation and railing against the IMF, Argentine officials have gone on a charm offensive from Washington to London with a boosterish message: the mining sector is open for business.

The transition to green energy has made lithium one of the world’s most sought-after metals. The price of lithium carbonate (LCE), the raw material used in lithium-ion batteries, soared this year from a five-year average of around $14,000 per tonne to over $80,000. According to Benchmark Mineral Intelligence, a consultancy, as sales of electric vehicles grow, demand for LCE is set to increase to 2.4m tonnes in 2030, compared with around 600,000 tonnes this year. Although lithium is plentiful, supply is struggling to keep up. Worldwide ten working mines can produce battery-grade lithium, says Daisy Jennings-Gray of Benchmark. A global scramble to find cheap deposits and to build mines to meet the increase in demand has started. Argentina could benefit.