The lithium market experienced renewed volatility in August as supply interruptions in China and South America drove price increases, even without a f

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The lithium market experienced renewed volatility in August as supply interruptions in China and South America lifted prices, even without a fundamental shortage. On August 10, Reuters reported that Contemporary Amperex Technology Co. Ltd. (CATL) suspended production at its Jianxiawo lithium mine in Jiangxi province after its permit expired. The mine represented about 46,000 metric tons of lithium carbonate equivalent annually, or roughly 3% of forecast global output for 2025. Reuters noted that the announcement "sparked a surge in lithium futures and miners' share prices, amid a broader crackdown on overcapacity."

Discovery Alert wrote on August 11 that CATL's suspension represented "a significant disruption to global lithium supply chains," with futures on the Guangzhou Futures Exchange immediately jumping 8%, marking the sharpest daily movement in more than 18 months. The site noted that lithium's nearly 90% price decline since its 2022 peak had left producers struggling, and that this disruption provided "the first significant upward price catalyst" after two years of declines.

Stockhead wrote on August 12 that Australian spodumene producers quickly rallied on the news, with Liontown Resources gaining 17.75% to close at 99.5 cents and Pilbara Minerals jumping 19.17% to US$2.30. Other producers such as Mineral Resources, IGO, and Piedmont Lithium also posted double-digit gains.

Benchmark Mineral Intelligence wrote in a special issue dated August 14 that the Jianxiawo site accounted for around 30% of Jiangxi's lithium output, ~3% of global LCE supply, and ~5% of global concentrate. The report confirmed that battery-grade lithium carbonate trades in China were assessed at 7.5% higher week-over-week by August 13. Daisy Jennings-Gray, head of prices at Benchmark, stated that "EXW China lithium carbonate prices are already heading as high as 80,000–87,000 RMB/tonne (US$11.1–12.1/kg), after operations at CATL's Jianxiawo mine have been suspended."

Concerns grew further in mid-August when reports surfaced of an acid tank explosion at Albemarle's La Negra chemical plant in Chile. According to the Benchmark report, one of the plant's three production lines was forced offline for three days. The disruption was limited, but the news added to supply concerns that were already influencing market sentiment.

Inventories and Market Reaction

Despite the shutdowns, Benchmark noted that China held significant inventories of approximately 130,000 tonnes LCE in July. The report explained that "this week's price movements are primarily being driven by sentiment and reflect the speculative nature of lithium trading in China," as buyers evaluated the duration of mine closures and their impact on downstream converters.

Fastmarkets also addressed tightening conditions in a February 6 report, projecting that after years of oversupply, the lithium market would move closer to balance in 2025. Paul Lusty, head of battery raw material analytics at Fastmarkets, said that "lithium market conditions – particularly during the latter part of 2024 – led to growing producer restraint, both in China and elsewhere."

While inventories cushioned short-term supply risks, underlying fundamentals continued to show a narrowing oversupply. Fastmarkets estimated that global production increased from just over 737,000 tonnes in 2022 to nearly 1.2 million tonnes in 2024 on an LCE basis. The research group projected a surplus of only 10,000 tonnes in 2025, potentially shifting to a small deficit of 1,500 tonnes in 2026.

Carbon Credits wrote on May 22 that supply grew more than 35% in 2024, outpacing demand growth of 30%. Prices fell to around US$12,000 per tonne LCE, a sharp drop from 2022 highs. Still, the outlet pointed to projections from the EU's Raw Materials Information System that demand for most battery materials, including lithium, would exceed supply after 2029–2030.

On July 21, Investing News Network highlighted that despite multi-quarter price weakness, long-term drivers such as electric vehicle adoption and energy storage demand remained intact. Paul Lusty told the outlet that "the fundamentals are really still very strong, and these are anchored in some very powerful, mega trends that we see developing within the global economy; the urgent drive for climate change mitigation, the once in a generational shift in the global energy system, and also the rise of energy intensive technologies such as artificial intelligence."

Although disruptions at Jianxiawo and La Negra did not create an immediate structural deficit, sentiment-driven gains underscored the market's sensitivity to regional supply interruptions. The August 14 Benchmark report concluded that while "the market will not move into deficit in the near term or by 2026," uncertainty over the duration of closures and regulatory actions in China was likely to keep prices elevated in the short term.

With lithium markets showing renewed volatility, it is useful to consider how individual companies are situated within these changing conditions. Atlas Lithium Corp., which holds exploration and development interests in Brazil, provides an example of how project developers may be affected by broader supply shifts. The company's progress offers context for understanding how market dynamics influence firms working to advance new sources of lithium.

Atlas Lithium Corp. 

Atlas Lithium Corp. (ATLX:NASDAQ) is a U.S.-listed exploration and development company with a portfolio of lithium and other critical mineral projects in Brazil. The company's primary focus is on advancing its Neves Lithium Project in Minas Gerais, while its 30%-owned subsidiary Atlas Critical Minerals Corp. (JUPGF:OTCQB) is pursuing opportunities in rare earths, titanium, and graphite.

The company announced on August 25 that Atlas Critical Minerals Corp. had published technical reports confirming high-grade mineralization at two Brazilian projects. The reports, prepared by SGS Canada Inc. under U.S. SEC Regulation S-K 1300 standards, detailed results from the Alto do Paranaíba rare earths and titanium project and the Malacacheta Graphite Project, both located in Minas Gerais State. Highlights included total rare earth oxide grades as high as 28,870 ppm and titanium dioxide content of 23.2% at Alto do Paranaíba, while Malacacheta delivered graphite concentrate grades up to 96.6% graphitic carbon. CEO Marc Fogassa said the results "corroborate the strategic value of our diversification approach."

Beyond these new findings, Atlas continues to advance its flagship Neves Lithium Project, also in Minas Gerais. Analysts have also underscored Atlas's financial positioning. In a July 14 report, H.C. Wainwright & Co. analyst Heiko Ihle maintained a Buy rating with an US$18 target, highlighting projected operating costs of US$489 per ton of concentrate and existing offtake and investment agreements totaling US$80 million. Ihle added that Atlas Critical Minerals complemented the company's lithium operations by diversifying its critical mineral exposure.

On August 5, Alliance Global Partners analyst Jake Sekelsky reiterated a Buy rating following the release of a definitive feasibility study (DFS). He described the DFS as "an inflection point on the road to lithium production," citing its net present value of US$540 million at a lithium price assumption of US$1,700 per ton, with a capital expenditure requirement of US$58 million. Sekelsky noted that Atlas had already invested US$30 million in development and had a US$40 million prepayment facility in place, calling the Neves project "shovel-ready."

Atlas Critical Minerals holds more than 218,000 hectares of mineral rights across multiple Brazilian states, covering rare earths, titanium, graphite, uranium, copper, and nickel. While lithium remains the company's core focus, the recent technical reports from Alto do Paranaíba and Malacacheta demonstrate additional mineral potential within its portfolio. This combination of lithium development and broader critical minerals exploration places Atlas among the firms working to expand Brazil's role in global battery and energy transition supply chains. 

According to Atlas Lithium, its management and insiders own about 27% of the company's shares. Strategic partners, including Mitsui & Co., hold another roughly 11%. Institutional investors own about 10%. The rest, about 52%, is in retail.

Refinitiv reports that Atlas has 19.58M outstanding shares and 11.43M free float traded shares. Its market cap is US$117.3M. Its 52-week range is US$3.54–12.48 per share.