Zijin Mining Group Co. (ZIJMF), China’s leading miner, will miss its lithium output target this year due to stagnant prices. The company had aimed for 25,000 tons but will fall short, announcing the decision on Monday as it released a 46% increase in first-half earnings.

Zijin Mining Faces Lithium Challenges

Zijin is a key player in copper and gold but is expanding its focus on lithium projects in China, Argentina, and the Democratic Republic of Congo. However, they intend to control project commissioning and construction pace amidst an industry-wide oversupply.

Market Dynamics Affecting Lithium

The glut in lithium supply is leading to a price drop, with lithium carbonate prices at three-year lows. Demand growth from the electric vehicle sector has been slower than anticipated. UBS Group AG predicts that the surplus market conditions will persist until at least 2027.

Strategy and Market Outlook

In May, Zijin revised its lithium production targets for next year down by 20,000 tons to 100,000 tons. Despite the current market challenges, they believe price weakness might accelerate a supply-demand rebalance.

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