Yahua Industrial Group has secured a new order from Tesla for its supply of lithium carbonate, an essential raw material for the production of electric vehicle (EV) batteries.
Under the purchase agreement, China’s Yahua, through its subsidiary Yahua Lithium Ya’an, will supply an unspecified amount of lithium carbonate to Tesla between 2025 and 2027, with the option to extend by an additional year.
Additionally, the price of lithium carbonate will be determined in accordance with the method agreed upon by the two parties.
Currently, there is a signed contract for Yahua to supply 63,000 to 88,000t of lithium hydroxide to Tesla from 2021-2025, with a total value of US$880M. In August last year, the contract was extended by 7.5 years for a larger supply of 207,000 to 301,000t.
By the end of 2023, Yahua had already provided US$799M of lithium products to the US carmaker, according to the group’s annual trading report.
Sichuan-based Yahua, which mainly manufactures and sells industrial explosives, is heavily involved in the EV battery space and is one of the first in the China to produce lithium hydroxide. It currently has established partnerships with Contemporary Amperex Technology Ltd., the largest battery maker in the world, as well as South Korea’s LG and SK On.
The group also has investments in multiple lithium mining projects around the globe, led by the Kamativi mine in Zimbabwe, which has already begun outputting the battery material and is expected to reach full production this year.
Yahua has offtake agreements with lithium miners including Vancouver-based Sigma and Australia’s Pilbara Minerals.
