Global lithium consumption in 2026 is expected to remain largely driven by the growth in electric vehicle (EV) sales, particularly in China, according to the Department of Industry, Science and Resources (DISR) December 2025 'Resources and Energy Quarterly'.

In Australia, the Electric Vehicle Council recorded a 38% increase in EV sales in 2025. In December, 16.7% of new vehicles sold were electric.

Electric Vehicle Council chief executive Julie Delvecchio noted that EVs now constitute more than 13% of all new car sales. She stated that these figures reflect the influence of consumer confidence supported by government policies aimed at reducing carbon emissions and lowering costs for drivers.

According to the publication, a market research firm forecasts that nearly one in every two cars sold will be a battery electric vehicle (BEV), leading to a 35% increase in global battery demand by 2030, as per its Strategy & Analysis.

The rising demand for EVs is part of a broader global transition towards electrification, as outlined in the Paris Agreement adopted at the United Nations Climate Conference in 2015. The Paris Agreement is a global initiative to limit human-induced global warming. Signatory countries are required to establish progressively ambitious national climate targets and transition towards net zero emissions.

BESS market expansion

While EVs will continue to drive global lithium demand, battery energy storage systems (BESS) are also expected to play a growing role, according to DISR's final quarterly forecast for 2025.

The report indicates that China has substantial BESS capacity installed across numerous projects nationwide. These projects are primarily lithium-ion based, in contrast to the United States, which had lower installed BESS capacity as of March 2025.

DISR projects that Australia is likely to remain a significant supplier of lithium in 2027 and beyond, with 9% of global lithium hydroxide production expected to be generated domestically by 2027.

Export values increased in the 2025-26 period and are projected to rise further in 2026-27.

A market research firm reports the price of lithium at JPY 140,000 (US$ 879) per tonne as of 9 January 2026, representing a 51.02% increase over the previous month.

Companies such as Patagonia Lithium are preparing to enter production in response to global lithium demand. Patagonia signed a non-binding strategic partnership agreement with Ameerex Corporation to support its Formentera Lithium Project in Argentina, as well as niobium and rare earth projects in Brazil.