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Sharp Lithium Price Crash Drives Scrap Reassessment
Battery lithium prices collapsed from $80,000 per tonne in November 2022 to $8,450 in June 2025, shaking recycling economics. Consequently, scrap recovery models for lithium are under intense review. Meanwhile, producers like SQM laid off 5% of Chilean staff amid prolonged price weakness. Therefore, scrap traders and recyclers must recalibrate collection and processing strategies.
Lithium vs Nickel Economics in EV Scrap Context
The lithium value in EVs from January to May reached $2.15 billion globally, but nickel overtook lithium in monthly EV battery value. As a result, recyclers now prioritize nickel recovery even as lithium usage persists in LFP chemistries. Meanwhile, lithium cost per EV dropped from $1,900 in 2022 to just $200, forcing scrap processors to improve recovery yields and cost efficiency.
Implications for Scrap Metal and Recycling Markets
Scrap processors face growing pressure to integrate lithium recovery alongside traditional ferrous streams. Therefore, they must invest in new technologies and partnerships. In contrast, oversupply and falling prices challenge investment viability. Meanwhile, policy support in China sustains some mines, which may delay price recovery and impact scrap material availability.
ScrapInsight Commentary
The lithium price collapse demands a strategic pivot toward efficient lithium recovery in the scrap sector. As nickel gains prominence, recyclers should diversify recovery capabilities. Policy alignment and technological investment in battery recycling will determine economic resilience in the evolving circular economy.
