Sunita Somvanshi
CATL has halted production at its Jianxiawo lithium mine in China’s Jiangxi province after failing to renew a mining permit that expired on August 9, 2025. According to people familiar with the matter, the shutdown is expected to last at least three months while the company works to secure permit renewal.
CATL confirmed the suspension through China’s stock information disclosure platform, stating it is “expediting the application for an extension of the mining permit and will resume production as soon as possible upon approval.”
The news sent lithium prices surging. Lithium carbonate futures on China’s Guangzhou exchange hit the daily limit of 8%, reaching RMB 81,000 ($11,280) per ton. Mining stocks also jumped, with Tianqi Lithium rising 19% and Ganfeng Lithium up 21% in Hong Kong trading.
The Jianxiawo mine contributes significantly to the global lithium supply. According to Bank of America, it accounts for approximately 6% of global output, while other sources estimate its contribution at around 3% of global lithium production. For broader context, see:
Production costs at the facility are approximately RMB 100,000 ($13,920) per ton, according to CnEVPost reporting from September 2024. This places the operation underwater in the current market environment, where battery-grade lithium carbonate is trading around RMB 70,000 ($9,744) per ton.
This cost gap raises questions about the operation’s viability, potentially complicating the permit renewal process.
The suspension comes as Chinese authorities increase scrutiny of the mining sector. Eight additional Yichun region miners must submit reserve reports by September 30, following an audit that uncovered non-compliance issues in the registration and approval processes.
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This aligns with China’s broader efforts to address industrial overcapacity, including in the lithium sector, which has faced severe oversupply since 2023.
For comparison, see how Chinese lithium policy intersects with global scrutiny:
Analysts offer mixed views on long-term implications. Zhang Weixin from China Futures notes: “CATL’s situation does not change the oversupply structure in the market. However, if production disruption is expanded to other mines in Yichun after Sept. 30, lithium prices could go even higher.”
Citi analysts see “an evenly balanced chance for CATL’s license to be renewed” and expect a “sentiment-driven price rally.”
Despite the price jump, fundamental oversupply conditions persist. According to Fastmarkets‘ projections, the global lithium surplus for 2025 is estimated at around 10,000 tonnes, while S&P-linked reporting suggests approximately 33,000 tonnes.
Key factors to watch:
- CATL’s permit renewal timeline
- Yichun reserve report deadlines
- China’s mining policy updates
- Lithium inventory levels at major facilities
For future technology directions:
- China’s revolutionary sodium-ion battery EV can disrupt lithium power
- CATL’s new bus battery claims 1.6 million km or a 15-year lifespan
- Porsche EV battery recycling converts 65 tons into black mass
The situation highlights the increasing scrutiny of battery minerals, with governments worldwide prioritizing secure and transparent supply chains for the energy transition.
