In-Depth Analysis of the Impact of Salt Lake Lithium Extraction Technological Breakthroughs on the Cost Structure and Competitive Landscape of Domestic Lithium Resource Enterprises

On January 10, 2025, the research team of the Qinghai Institute of Salt Lakes, Chinese Academy of Sciences, announced that it has successfully overcome the technical bottleneck of efficient separation of lithium, sodium, and potassium ions in lithium precipitation mother liquor, and has achieved 10,000-ton scale industrial application in salt lake lithium carbonate production enterprises[1][2][3]. The core innovations of this technological breakthrough are as follows:

Technical Indicator	Before Breakthrough	After Breakthrough	Improvement Margin
Lithium Recovery Rate from Lithium Precipitation Mother Liquor	~75%	Over 98%	+23 percentage points
Overall Lithium Ion Recovery Rate	Baseline level	Increased by 15-20%	15-20%
Production Cost	Baseline	Reduced by 30%	-30%
Water and Energy Consumption	Baseline	30% below industry standards	-30%
Newly Added Output Value	-	Over RMB 600 million	Significant incremental benefits

The core of this technology lies in a new lithium-specific extractant independently designed and synthesized by the research team, which can separate lithium ions from complex lithium precipitation mother liquor with high selectivity and efficiency, systematically solving the problems of traditional extraction systems in environmental friendliness, operational safety, and comprehensive cost control[3].

Currently, the world’s first 10,000-ton scale industrial demonstration line for battery-grade lithium carbonate production via lithium extraction from salt lake lithium precipitation mother liquor has been completed in Qinghai Province. Expert evaluations show that this technology has reached an internationally advanced level, providing key technical support for the high-quality development of China’s salt lake lithium industry[1][2].

---

According to the latest market data, the cost structures of the three major lithium extraction technical routes adopted by Chinese lithium resource enterprises show significant differences:

Lithium Extraction Technology	Representative Enterprises/Projects	Total Cost (RMB 10,000/ton)	Cash Cost (RMB 10,000/ton)	Cost Advantage Rating
Salt Lake Lithium Extraction	Salt Lake Co., Ltd. (Qarhan Salt Lake)	3.65	2.0	★★★★★
Salt Lake Lithium Extraction	Zangge Mining (Qarhan Salt Lake)	3.5	2.2	★★★★★
Salt Lake Lithium Extraction	Tibet Mining (Zabuye Salt Lake)	3.5-4.0	2.5	★★★★☆
Spodumene Lithium Extraction	Tianqi Lithium (Greenbushes)	6.0	4.5	★★★☆☆
Spodumene Lithium Extraction	Mainstream Australian Mines	5.5-6.0	5.0	★★★☆☆
Spodumene Lithium Extraction	Ganfeng Lithium (Partial Outsourcing)	8.0+	7.0+	★★☆☆☆
Lepidolite Lithium Extraction	Yongxing Materials et al. (High Grade)	7.5	6.5	★★☆☆☆
Lepidolite Lithium Extraction	Low-Grade Lepidolite Ore	12.0+	10.0+	★☆☆☆☆

With a comprehensive cost of

, salt lake lithium extraction is at the absolute left end of the cost curve among the three technical routes, with significant cost advantages[4][5][6].

This breakthrough in efficient separation technology for lithium precipitation mother liquor will reshape the cost structure of salt lake lithium extraction enterprises from the following dimensions:

• By increasing the overall lithium ion recovery rate by 15-20 percentage points, the raw material input per unit product is correspondingly reduced
• The improved selectivity of the new extractant reduces auxiliary material consumption
• Based on the current lithium carbonate price of RMB 90,000-100,000 per ton, a 30% cost reduction means an increase of approximately RMB 27,000-30,000 in gross profit per ton

• The technological breakthrough has reduced water and energy consumption by more than 30% below industry standards
• Salt lake lithium extraction projects in Qinghai and Tibet inherently have lower energy cost advantages
• Environmental compliance costs are reduced, cutting down environmental governance expenditures

• The completion of the 10,000-ton scale industrial demonstration line verifies the replicability of the technology
• As the technology is promoted to more salt lake projects, unit fixed costs will be diluted
• The data showing newly added output value exceeding RMB 600 million indicates that the project has good economic benefits

According to market analysis, the current lithium carbonate price is fluctuating in the range of RMB 70,000-80,000 per ton, and the industry has basically achieved supply-demand balance[5][6]. At this price level:

• Salt Lake Lithium Extraction (RMB 30,000-40,000/ton)
  : Still has a gross profit margin of approximately 100%-150%
• Spodumene Lithium Extraction (RMB 55,000-80,000/ton)
  : Narrow gross profit margin, with some high-cost projects operating at a loss
• Lepidolite Lithium Extraction (RMB 60,000-130,000/ton)
  : Low-grade projects face high risk of severe losses

UBS research predicts that the average spot price of lithium carbonate will rise to RMB 135,000/200,000/180,000 per ton in 2026-2028 respectively, still leaving significant upside potential compared to the current price[5].

---

Since 2025, the valuation pattern of A-share lithium stocks has shown significant changes[7][8]:

Enterprise Type	Valuation Performance	Institutional Holding Changes	Core Logic
Salt Lake Lithium Extraction Enterprises	Salt Lake Co., Ltd. and Zangge Mining have market capitalization exceeding RMB 100 billion	Institutional holdings have increased significantly	Low cost + capacity release
Integrated Enterprises	Ganfeng Lithium leads the rally with over 60% growth	Institutional holdings have increased significantly	Upstream-downstream synergy + solid-state batteries
Pure Ore-based Lithium Extraction Enterprises	Valuations are sluggish, with market capitalization generally below RMB 20 billion	Institutional attention has decreased	Cost disadvantages are prominent

:

1. Advantage at the left end of the cost curve
   : The cost of RMB 30,000-40,000 per ton for salt lake lithium extraction is at the absolute left end of the global lithium cost curve, representing rigid supply
2. Certainty of capacity release
   : Salt lake projects are less affected by price fluctuations, with strong certainty of incremental capacity release
3. Technology iteration capability
   : Salt lake enterprises with independent core technologies enjoy higher valuation premiums

In 2024, the capacity utilization rates of domestic lithium salt enterprises showed obvious differentiation[4]:

Enterprise	Capacity Utilization Rate	Lithium Extraction Technology	Profitability
Zangge Mining	116%	Salt Lake Lithium Extraction	Stable profitability
Salt Lake Co., Ltd.	100%	Salt Lake Lithium Extraction	Gross profit margin of nearly 50%
Yongxing Materials	86%	Lepidolite Lithium Extraction	Profitability under pressure
Tianqi Lithium	77%	Spodumene Lithium Extraction	Break-even
Ganfeng Lithium	~56%	Spodumene + Salt Lake Lithium Extraction	In loss

:

• Low-cost salt lake lithium extraction and “integrated” ore-based lithium extraction enterprises are operating at nearly full capacity
• Lithium salt enterprises with insufficient raw material self-sufficiency and high costs have seen their capacity utilization rates drop to 50% or below
• Some high-cost lepidolite lithium extraction projects face pressure to reduce production or exit the market

According to the 2025 production structure forecast[4][6]:

Spodumene Lithium Extraction (including Africa)    █████████████████████████  55%
Salt Lake Lithium Extraction               ████████████████          30%
Lepidolite Lithium Extraction             ██████████████            23%
Other                   ████                      6%

With the strengthening of cost advantages brought by salt lake lithium extraction technological breakthroughs, it is expected that:

• The proportion of salt lake lithium extraction will gradually increase from the current 16% to
  over 40%
• The substitution effect of low-cost salt lake projects on high-cost capacity will accelerate
• The share of Australian mines in spodumene lithium extraction will decline, while the share of African and integrated projects will increase

---

:

• Market Capitalization: RMB 165.5 billion (second largest in A-share lithium industry)[0]
• PE Ratio: 27.47x
• ROE: 15.61%
• Gross Profit Margin: 46.20%
• 2025 Q3 net profit exceeded expectations with 10.18% growth

:

1. Leading Capacity Scale
   : Has an annual lithium carbonate capacity of 80,000 tons, making it the largest enterprise in China’s salt lake lithium extraction sector
2. Significant Cost Advantage
   : 2024 production cost per ton was only RMB 36,500, located at the left end of the global cost curve
3. Abundant Technology Reserves
   : Lanke Lithium has increased the lithium recovery rate from lithium precipitation mother liquor from 75% to over 95%
4. Clear Strategic Planning
   : Plans to form an annual lithium salt capacity of 200,000 tons by 2030

:

• Market Capitalization: RMB 136.8 billion (approaching RMB 100 billion)[0]
• PE Ratio: 39.25x
• ROE: 23.41% (highest in the industry)
• Gross Profit Margin: 90.92% (synergy between potassium and lithium core businesses)
• 2025 growth reached 195.63%, making it one of the best-performing lithium stocks of the year

:

1. Excellent Resource Endowment
   : Qarhan Salt Lake has abundant reserves, with associated potassium and lithium resources
2. Leading Capacity Utilization
   : 116% capacity utilization reflects strong cost competitiveness
3. Synergy with Zijin Mining
   : After Zijin Mining took control, it promised to prioritize Zangge Mining for relevant business opportunities
4. Long-Term Capacity Planning
   : 50,000-ton/year project at Mamco Salt Lake and subsequent 50,000-80,000-ton capacity plan

:

• Market Capitalization: RMB 137.1 billion (largest in A-share lithium industry)[0]
• Currently in loss (negative PE ratio)
• ROE: -3.41%
• 2025 Q3 performance exceeded expectations significantly, with revenue growth of 33.11%

:

1. Largest Resource Layout
   : Overseas salt lake projects including Cauchari-Olaroz in Argentina and Goulamina in Mali
2. High Degree of Integration
   : Covers the entire lithium battery industry chain from upstream to downstream, reducing cyclical volatility risks
3. Solid-State Battery Track
   : Directly lays out battery manufacturing, aligning with capital market hotspots
4. Increased Self-Sufficiency Rate
   : With the commissioning of new projects, the self-sufficiency rate is expected to further increase from 55%

:

• Market Capitalization: RMB 33.9 billion[0]
• PE Ratio: 40.28x (technology premium)
• ROE: 20.70%
• Gross Profit Margin: 39.26%

:

1. Technology Output Model
   : Has participated in a total of nearly 100,000 tons of salt lake lithium extraction capacity
2. Binds with Key Clients
   : Provides technical support for the lithium hydroxide production line at Jiezê Caka Salt Lake and the capacity expansion project at Lop Nur Salt Lake
3. High Growth Potential
   : The technology service industry enjoys higher valuation premiums and benefits from the expansion of the salt lake lithium extraction industry

---

This technological breakthrough will accelerate the restructuring of the cost curve in the lithium resource industry:

:

• Comprehensive costs of salt lake lithium extraction enterprises will further decrease by 3-5%
• Gross profit margin advantage will expand from the current approximately 50% to over 60%
• High-cost capacity with costs above RMB 80,000 per ton will be consolidated at an accelerated pace

:

• Market share of salt lake lithium extraction will increase to 35%-40%
• Market share of spodumene lithium extraction will drop to 45%-50%
• Lepidolite lithium extraction enterprises will be forced to transform or exit the market

• Leading enterprises such as Salt Lake Co., Ltd. and Zangge Mining are concentrated here
• Improved supporting facilities bring scale effects
• Policy support continues to increase

• Development of salt lake resources such as Zabuye and Mamco is accelerating
• High environmental protection requirements but excellent resource endowment
• Technological breakthroughs reduce development difficulty and costs

Segment	Original Pattern	New Pattern Trend
Upstream Resources	Australian mines + South American salt lakes dominate	Share of Qinghai salt lakes increases
Midstream Smelting	Spodumene-dominated	Share of salt lake lithium extraction increases
Downstream Materials	Cost-sensitive	More focused on supply stability
Terminal Applications	Price-oriented	Diversified supplier system

---

• Focus on Salt Lake Co., Ltd. and Zangge Mining
• Salt Lake Co., Ltd.: Capacity expansion + cost advantage + institutional holdings increase
• Zangge Mining: Leading ROE + Zijin Mining synergy + high growth potential

• Focus on technology service enterprises such as Lanxiao Technology and Jiuwu Hi-Tech
• Technology output model benefits from the expansion of the salt lake lithium extraction industry
• Enjoys valuation premium

• Focus on Ganfeng Lithium and Tianqi Lithium
• Integrated layout reduces cyclical volatility risks
• Focus on cost improvements brought by increased self-sufficiency rate

Risk Type	Specific Content	Impact Degree
Lithium Price Fluctuations	Sharp decline in lithium carbonate price	★★★★★
Technological Risks	New technology promotion falls short of expectations	★★☆☆☆
Policy Risks	Tightening of environmental policies affects capacity	★★★☆☆
Geopolitical Risks	Overseas project operation risks	★★★☆☆
Overcapacity	Concentrated release of new industry capacity	★★★★☆

• Lithium Carbonate Price
  : Focus on the cost support level of RMB 60,000-80,000 per ton
• Capacity Utilization Rate
  : Salt lake lithium extraction enterprises should maintain above 90%
• Inventory Level
  : Changes in smelter inventories reflect supply-demand patterns
• Technology Promotion Progress
  : Application scope of lithium precipitation mother liquor technology

---

Technological breakthroughs in salt lake lithium extraction have had a

on domestic lithium resource enterprises:

1. Cost Structure Optimization
   : Overall lithium ion recovery rate increased by 15-20%, production costs reduced by 30%, further consolidating the cost advantage of salt lake lithium extraction at RMB 30,000-40,000 per ton
2. Competitive Landscape Restructuring
   : Valuation logic shifts from “mine ownership supremacy” to “technology + resources”, with salt lake lithium extraction enterprises continuing to receive institutional favor and market capitalization exceeding RMB 100 billion
3. Accelerated Industry Consolidation
   : High-cost capacity with costs above RMB 80,000 per ton faces survival pressure, and differentiation in capacity utilization rates intensifies
4. Investment Opportunities Emerge
   : Low-cost leaders such as Salt Lake Co., Ltd. and Zangge Mining have long-term investment value, while technology service providers such as Lanxiao Technology benefit from industry expansion

With the continuous development of the global new energy industry and the gradual improvement of the lithium carbonate supply-demand pattern, salt lake lithium extraction enterprises are expected to be the first to benefit in the

, achieving high-quality development with both volume and price growth.

---

[1] Sina Finance - “China Achieves Major Breakthrough in Key Extraction and Separation Technology for Salt Lake Lithium Resources” (https://finance.sina.com.cn/roll/2026-01-10/doc-inhfuzwu0541885.shtml)

[2] Eastmoney - “China Makes New Breakthrough in Key Extraction and Separation Technology for Salt Lake Lithium Resources” (https://finance.eastmoney.com/a/202601103614935629.html)

[3] IT Home - “China Achieves Major Breakthrough in Key Extraction and Separation Technology for Salt Lake Lithium Resources” (https://www.ithome.com/0/912/082.htm)

[4] Securities Times - “Only 1/4 of Production Cut: The ‘Tug of War’ in Capacity Reduction of A-share Lithium Industry” (https://www.stcn.com/article/detail/1822822.html)

[5] 21st Century Business Herald - “Lithium Price, Making a Comeback?” (https://www.21jingji.com/article/20260106/herald/2f6c44579bd9db2b89930e443a9b2aa1.html)

[6] EqualOcean Think Tank - “Annual Lithium Price Trend Forecast and Analysis (2025)” (https://www.iyiou.com/analysis/202501201088710)

[7] National Business Daily - “Ten-Year Changes in Valuations of Lithium Stocks, Leading Group Switches Again” (https://www.nbd.com.cn/articles/2025-10-14/4089593.html)

[8] Pedaily - “To Understand the ‘Lithium’ Script, Try Looking at Zangge Mining” (https://news.pedaily.cn/202512/558314.shtml)

[9] Zhiyan Consulting - “Background, Industrial Chain Map, and Development Status of China’s Salt Lake Lithium Extraction Industry” (http://news.10jqka.com.cn/field/20251128/672807981.shtml)

[10] People’s Daily “China Energy News” - “Lithium Carbonate Industry Ushered in a New Upward Cycle” (http://paper.people.com.cn/zgnyb/pc/content/202512/08/content_30119608.html)

[0] Jinling AI Financial Database - Financial and market data of major lithium resource enterprises