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A beginner’s guide to lithium: Price, uses & market overview
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On this page, we explore everything you need to know about lithium. Gain insights into lithium market trends, pricing mechanisms, and the environmental impact of lithium.
Read on to learn more about this popular commodity and find links to beginner friendly guides explaining how you can get involved in lithium.
What is lithium?
Copy link to sectionLithium is an important commodity in today’s world and plays a crucial role in the development of modern technologies. The silvery-while metal is used in making lithium-ion batteries which power various electronic devices from smartphones and laptops to electric vehicles and energy storage systems.
Lithium’s history dates back to the 18th century when early scientists discovered its medicinal properties. However, it was not until the 1970s that its ability to power batteries was realised. The development of lithium-ion batteries in the 1980s revolutionised its uses.
Since then, the lithium market has grown exponentially. The global lithium industry is valued at around $40 billion in 2025. This growth is fueled by the increasing demand and adoption of electric vehicles and the expansion of renewable energy storage systems.
Lithium market overview
Copy link to sectionLithium has undergone a staggering transformation in recent decades. During the 2000s, the lithium market experienced a period of consolidation and price volatility, followed by a resurgence in the 2010s driven by the rise of electric vehicles.
The industry is worth an estimated $40 billion per year but is expected to grow to $89.9 billion by the end of the decade. This represents a compound annual growth rate of 22.1%. In 2022, lithium prices reached record highs due to supply constraints and surging demand from the electric vehicle industry
Is lithium valuable?
Copy link to sectionYes, lithium is a valuable commodity and there are numerous reasons why investors are attracted to the market. We have highlighted some of these key fundamentals below, explaining what they are and why they matter.
- It’s an essential component of lithium-ion batteries. Lithium-ion batteries now power many devices from everyday electronics like smartphones and laptops to electric vehicles. The demand for these batteries is expected to continue growing which bodes well for lithium.
- Lithium’s demand is growing. The demand for lithium has been growing rapidly for many years now and has been further enhanced by other applications in the medical field and electric vehicles. This demand looks unlikely to slow any time soon.
- There is potential for value appreciation. The price of lithium has experienced significant growth. As the demand for lithium-ion batteries continues to expand, lithium’s price has the potential to appreciate further making it a good choice for long-term commodity investors.
- There is limited supply. Lithium resources are spread across the globe although they are relatively scares. A few regions such as CHile, Australia, and Argentina are where lithium is concentrated. This limited supply and the continuing growing demand can help its future.
How to invest in lithium
Copy link to sectionYou can invest in lithium by using a commodity trading platform. These platforms offer a range of commodities and are very easy to use. There are different platforms suitable for specific requirements.
Some let you buy lithium, others let you trade lithium, and many are designed for investing in the metal. Visit our dedicated guide to discover how to invest in lithium.
lithium in your investment portfolio
Copy link to sectionA diverse investment portfolio can help protect you during market uncertainty, and the inclusion of lithium can add value while allowing you to spread your money across various markets.
Lithium often moves independently to traditional investments like stocks and bonds. You can include lithium in your portfolio as a hedge against potential losses. During times of economic uncertainty, investors view commodity grains such as lithium as attractive options.
LIthiums standing as a key component in lithium-ion batteries and other applications makes it a good long-term play.
Lithium vs other commodities
Copy link to sectionLithium is part of the metals family of commodities, including gold, platinum, and palladium. Each commodity is unique in its own way and offers different features for investors and traders. You can learn more about specific precious metals using our dedicated guides below.
- Gold. Gold is the most popular precious metal in the world.
- Platinum. Platinum is more expensive than gold on a weight-for-weight basis.
- Palladium. Palladium is a rare metal with industrial use.
