Impacted Domains: Operational, Financial, Reputational
Impacted Industries: Manufacturing, Utilities
Date: August 12, 2025

BLUF:
Global lithium supply has contracted by 4%, driving price spikes and intensifying shortages across critical battery materials.

So What:
With Chinese lithium mine suspensions constraining availability, firms face production delays, missed delivery timelines, and tightening margins. While alternative chemistries can reduce dependency, market volatility is accelerating and impacting near-term planning.

Risk Value:
$2M–$25M for mid-size manufacturers and utilities, depending on inventory exposure and supplier concentration.

Mitigation Cost:
$175K–$650K for sourcing strategy updates, alternative chemistry adoption, and risk modeling.

What to Do:

• Audit supplier contracts for allocation rules, escalation triggers, and price-adjustment clauses.

• Diversify into sodium-ion, LFP, solid-state chemistries, and battery recycling pathways.

• Track lithium price volatility weekly and model operational and margin impacts.

• Run cross-functional supplier dependency workshops to identify concentration risks and build contingency plans.

Risk AIQ Score: 8

🔗 Reuters: CATL Lithium Mine Suspension Report