Zimbabwe's ban sparks supply concerns, lithium carbonate breaks through the 180,000 mark, listed companies respond intensively

On February 25, the Zimbabwean government announced the immediate suspension of all lithium concentrate exports, an unexpectedly stringent policy that shocked the global lithium supply chain and sparked strong expectations for an upward movement in lithium carbonate prices.

Boosted by the news, on February 26, the main contract of domestic lithium carbonate futures surged up to 12% intraday, reaching 187,000 yuan/ton, before narrowing gains to 3.47% at close, priced at 173,700 yuan/ton. Notably, the previous trading day saw a jump of over 10%, marking the largest single-day gain since listing.

The lithium mining sector of A-share stocks strengthened simultaneously, with intraday gains exceeding 3%. Erkang Pharmaceutical rose over 12%, Corun and Jinyuan rose 10%, and Salt Lake, Tianqi Lithium, Ganfeng Lithium and others followed higher.

Guotai Haitong Securities believes that the export ban will be a major disturbance to global lithium supply. With current inventory at low levels and continuously reduced for five weeks, plus sustained downstream demand recovery after the Spring Festival, the short-term supply gap is expected to support lithium carbonate prices. The institution expects lithium prices to fluctuate with a strong bias, thus maintaining an industry “overweight” rating.

Chinese-funded mining companies with operations in Zimbabwe, such as Shengxin Lithium Energy, CMOC, Tianhua New Energy, and Yahua Group, have responded to the impact of the ban.

Ban implemented well ahead of expectations, covering goods in transit

Guotai Haitong Securities notes that the Zimbabwean lithium mine export ban came much earlier than originally planned and is being enforced more stringently than expected.

The Zimbabwe Ministry of Mines and Mineral Development issued an emergency statement on February 25 local time, announcing the immediate suspension of all exports of raw ores and lithium concentrates, and clarifying that the ban applies to all minerals currently in transit, with no timeline for resuming exports.

According to the new regulations, only enterprises holding valid mining rights and approved concentrator plants are eligible to export in the future. Agents and third-party traders are banned from participating. Applicant companies must submit recommendations from provincial mining offices regarding processing capabilities and compliance, and declare mineral compositions, with violators facing revocation of export permits and mining rights.

The report mentions that, tracing the policy context, Zimbabwe has banned export of unprocessed lithium ore since 2022, and in June 2025 announced plans to ban lithium concentrate exports starting January 2027, requiring mining companies to build local lithium salt processing capacity. From January 2026, stricter scrutiny of illegal smuggling will begin. This ban is a continuation and early implementation of a series of policies; the core aim is to keep the entire lithium mining and refining supply chain in the country, so supply disruptions may persist. Currently, companies with lithium salt or lithium sulfate production capacity in Zimbabwe can still apply for lithium concentrate export licenses, and lithium sulfate products may continue to be exported.

Supply shock significant, brokerages expect strong lithium prices

Guotai Haitong’s report points out, if the ban continues, lithium supply will, significantly tighten, combined with five weeks of consecutive lithium carbonate inventory drawdowns and accelerated destocking, fundamentals will become even more strained, and lithium prices are expected to remain strongly volatile.

On the fundamentals side, lithium carbonate has already shown positive signals. From late January to February this year, SMM data shows lithium carbonate inventory declined for five consecutive weeks, with accelerating destocking, indicating improving supply-demand relations. With post-holiday demand gradually recovering and demand from power batteries and energy storage kicking in, consumption of lithium carbonate is expected to accelerate further. Looking ahead for the year, the demand side is driven by energy storage and power batteries, with faster growth; the supply side faces dual constraints of ongoing disruptions at major Jiangxi mines and new overseas uncertainties, so tight supply-demand is likely to persist throughout the year.

Regarding the scale of supply shock, Zimbabwe, as Africa’s largest lithium exporter and China’s second largest source of imported lithium concentrate, cannot be underestimated. USGS data indicates that Zimbabwe’s 2025 lithium resource output is about 28,000 metal tons, roughly 10% of global production. China Customs data shows China imported about 1.2 million tons of lithium concentrate from Zimbabwe in 2025, accounting for 15.5% of the year’s total imports of 7.751 million tons, equivalent to about 120,000–148,800 tons of lithium carbonate.

Great Wall Securities estimates that global lithium carbonate supply and demand in 2025 will be 2.1 million and 2.04 million tons respectively, already in tight balance. With the ban factored in, an annual shortage of 37,000–57,000 tons may appear. The firm believes that China’s lithium resource external dependence is about 60%, and Zimbabwe's supply cut means that about 9% of domestic lithium salt production raw materials face short-term risk of shortage, potentially driving structural price hikes in lithium carbonate.

Guotai Junan Futures estimates that in 2026, Zimbabwe will supply 177,000 tons lithium carbonate equivalent, 8.1% of global supply. Affected by geopolitics and resource localization, combined with tight fundamentals, lithium prices may remain strong. Caixin Futures notes that tightening lithium concentrate supply will drive prices up, making lithium carbonate price flexibility higher, highlighting the advantage of lithium sulfate exports, which may further raise industrial chain price centers and boost integration across the supply chain.

In the medium to long term, Great Wall Securities believes that localized processing will entail higher costs for energy, sulfuric acid, logistics, etc., providing higher support for long-term rigid costs of lithium carbonate. Guotai Haitong Securities expects that as Chinese companies’ lithium sulfate capacities in Zimbabwe become operational, the policy impact will gradually be digested, but supply disruptions may continue for now.

Chinese mining companies respond differently; some stocked up in advance

A-share listed companies with lithium mining projects in Zimbabwe include Shengxin Lithium Energy, CMOC, Tianhua New Energy, Yahua Group, etc., each with a different approach to the ban.

A CMOC representative responded on February 26:

"All Chinese lithium concentrate exports in Zimbabwe have stopped, awaiting follow-up policy details. Currently, Chinese enterprises’ deep-processing lithium products in the region are basically non-existent, with very small quantities. Our company is considering relevant supply chain expansion plans, but it’s not suitable to disclose at this time."

A Yahua Group spokesperson said:

“The company has already shipped out all lithium concentrates produced in Zimbabwe ahead of time. Recently, the local ‘export suspension’ will not impact the company’s production.”

The spokesperson further added:

“Based on the document, traders and agents without mining and processing certificates locally are no longer qualified to export. But Yahua Group can continue applying for export, just need to supplement relevant documents in the export permit process, which is already underway.”

A representative from Huayou Cobalt said the Zimbabwe “ban” mainly regulates illegal exports, and their mining certificate is issued by the local mining ministry. The actual impact remains to be determined.

Guotai Haitong Securities points out that the ban is expected to raise the threshold for Zimbabwe lithium concentrate exports and industry concentration. Traders without proper mining certificates or hand-held mines will be excluded, benefiting Chinese mining companies with compliant mining rights in Zimbabwe.

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