Australian mining company Liontown Resources said on Wednesday it has signed a five-year contract with Tesla to supply lithium spodumene concentrate, according to Reuters.
The contract is over 100,000 dry metric tonnes (DMT) of the concentrate, with the deal’s first year starting in 2024. In the following years, the company’s lithium concentrate output will increase to 150,000 DMT.
Liontown’s shares jumped almost 20 percent after the deal was announced.
Amidst a major shift to electric vehicles (EVs), lithium demand has skyrocketed throughout the past few years, causing suppliers to scramble to meet demand.
Tesla’s New ‘Table Salt’ Lithium Extraction Process Detailed in Patent https://t.co/H1HyZaSqo6
— TeslaNorth.com (@RealTeslaNorth) July 11, 2021
Current lithium prices are roughly eight times as high as prices were beginning 2021.
Tesla receives its minerals for battery cells from suppliers around the world, with the company already spending over $1 billion every year in Australian minerals alone. Other countries the automaker sources from include Canada, China, Mozambique and now the U.S.
Last month, Tesla signed the very first U.S. nickel supply deal with Talon Metals. During the same month, Tesla also announced plans to source graphite from Mozambique, Africa to help reduce its reliance on China for the mineral.
Tesla also shared a conflict mineral report with the Securities and Exchange Commission (SEC) last year, emphasizing that the company is committed to sourcing only “responsibly produced materials.”
