Kuvimba Mining House Nears $270 Million Lithium Deal with Chinese Investors

Zimbabwe’s state-owned Kuvimba Mining House is on track to finalize a $270 million deal with two Chinese companies for its lithium project, CEO Trevor Barnard announced on Monday. The project, centered on the construction of a 600,000 metric tons per year lithium concentrator at the Sandawana mine, continues despite the sharp decline in lithium prices since their 2022 peak.

Lithium prices have fallen more than 80% from their November 2022 highs due to oversupply and slower-than-anticipated growth in electric vehicle (EV) sales. However, analysts predict that robust EV sales in China and the closure of some mines will stabilize prices this year. Barnard expressed optimism that lithium prices will recover more strongly in 2024, although they are unlikely to return to 2022’s record levels. “That was obviously a bubble driven by huge demand forecasts and positive sentiment around lithium,” he noted.

Zimbabwe, Africa’s largest lithium producer, has seen over $1 billion in investment in lithium projects since 2021, primarily from Chinese battery metal companies. While Barnard did not name the specific Chinese investors in the current deal, prominent Chinese firms with lithium assets in Zimbabwe include Zhejiang Huayou Cobalt, Sinomine Resource Group, Chengxin Lithium Group, Yahua Group, and Canmax. These investments reflect China's efforts to consolidate its role in the global battery metal supply chain.

Barnard highlighted the Sandawana project’s strong fundamentals, stating, “We did a review of the Sandawana project and found it to be a very good project to proceed with due to the quality and size of the resource.”

The ongoing partnership between Kuvimba Mining House and Chinese companies underscores Zimbabwe’s strategic importance in the lithium market, particularly as demand for EV battery materials grows globally.