Lithium prices plunge as CATL nears restart of key mine

CATL’s Jianxiawo lithium mine received renewed land use approval on June 17, signaling progress toward restarting production after a 10-month shutdown.futunn
Lithium carbonate futures dropped more than 6% on June 18, with the selloff continuing June 22 as mining stocks including Ganfeng Lithium and Tianqi Lithium fell sharply.tradingeconomics
Analysts expect the mine, which represents roughly 3% of global lithium output, to resume production in Q4 2026, though a formal mining license is still pending.moomoo

CATL Mine Approval Sends Lithium Prices Into Sharp Decline

Lithium carbonate futures in China tumbled after the Jiangxi Provincial Department of Natural Resources confirmed that CATL had secured a renewed land use approval for its Jianxiawo lithium mine, one of the world’s largest lithium mica operations. The most active lithium carbonate futures contract for September 2026 fell more than 6% on June 18, dropping to around 160,000 yuan per ton — more than 20% below its recent peak. The selloff continued into the following week, with lithium falling further on June 22.futunn

A Mine Ten Months Dormant

The Jianxiawo mine in Yichun, Jiangxi province, ceased operations on August 9, 2025, after CATL’s mining license expired. What was initially expected to be a brief regulatory pause stretched into a prolonged shutdown, with heightened environmental scrutiny and government efforts to manage industrial overcapacity in the region delaying the renewal process.manifold

On June 17, Yichun CATL New Energy Mining Co. re-obtained the “Pre-approval and Site Selection Opinion for Construction Project Land Use,” valid through June 17, 2029, according to the Jiangxi Provincial Department of Natural Resources. Analysts say the approval signals the project is back on track, with production expected to resume in the fourth quarter of 2026.moomoo

Market Reverberations

The mine’s potential restart carries outsized weight for global lithium markets. When CATL originally suspended operations in August 2025, lithium carbonate prices surged 24% within ten days, and shares of rival producers like Tianqi Lithium and Ganfeng Lithium soared more than 19%. Now the reverse is playing out: following the land use approval, Ganfeng Lithium fell 4.46% and Tianqi Lithium dropped 4.7% in Hong Kong trading. In the spot market, battery-grade lithium carbonate prices fell by 800 yuan to 168,800 yuan per ton on June 18.thebambooworks

The mine has capacity to produce over 46,000 tons per year of lithium carbonate equivalent, accounting for roughly 3% of anticipated global output, according to Australian government data cited by Reuters. Its return to production would ease supply constraints that have supported lithium prices through much of the past year.msn

Regulatory Hurdles Remain

Despite the land use approval, the mine’s full restart is not yet assured. As of mid-2026, CATL is still awaiting the formal mining license clearance from the Bureau of Natural Resources of Yichun. The land use permit is a necessary step in the process, but analysts caution that additional regulatory approvals — including the mining rights renewal itself — must still be secured before operations can resume.manifold