Russia does not produce lithium raw materials and usually receives lithium carbonate from Chile, Argentina, China, and Bolivia, the official said, without mentioning the United States, the second-largest lithium carbonate supplier to Russia in 2021, according to statistics released on the Russian Federal Customs Service website.

Should Bolivia put the brakes on its provisions, there will be a major issue for Russia to cover its need for lithium-ion batteries, with China alone will not be able to fill this gap as the two countries itself is not able to produce enough of this raw material, the official said at an industry meeting at the Federal Council, quoted by med WashPost.

The ministry did not reply to an S&P Global Commodity Insights request to confirm the information.

The ministry did not clarify whether the suspension of supplies from parts of Latin America was due to directives at the government level, in the absence of any such sanctions, or as a result of self-imposed restrictions by the exporters or shipping companies they work with.

“In the current circumstances, it would be folly to view any supplies as a given,” a source in the lithium industry in Russia said.

“While some countries may not agree to sanctions on Russia, miners who are operating in or coming from another jurisdiction may take their initiatives,” he said, referring to sanctions enacted after Russia invaded Ukraine.

Major producers

In Chile and Argentina, few companies produce lithium carbonate but the biggest are SQM, Albemarle, Allkem and Livent, with SQM being Chilean, Albemarle and Livent U.S.-headquartered and Allkem Australian.

“We do not know if such [government] directive has been issued,” an SQM spokesperson told S&P Global.

“We are continuing with all obligations under a tolling agreement we have with a Russian producer about lithium carbonate, except any logistical issues and compliance with the sanctions already in place,” the representative said.

S&P Global, though, quotes Kelli Hopp-Michlosky, Albemarle vice president, head of global communications as stating that: "We cannot speak on behalf of the Chilean government, but what we can say is that Albemarle lives by its values. We have suspended shipment of products and technologies to Russia in response,” he said.

The company is also closely watching the situation in Ukraine, and there is currently no timeline for when it might resume shipments to Russia, according to Hopp-Michlosky.

Albemarle halting sales to Russia would, in turn, also likely translate to a drop in volumes that Russia typically receives from the United States, Albemarle’s second-largest supplier of lithium carbonate behind only Chile. Albermarle, besides running two lithium producing sites in Chile, has a 6,000 mt/year lithium plant in Nevada, in the western US, a base from which it is also a major lithium producer.

A Livent spokesperson, whose operations include Argentina, said the company does not have customers or shipments in Russia, according to S&P Global.

Allkem did not reply to emails from S&P Global before the time of publication.

In 2021, Russia imported 9,040 mt of lithium carbonate, with Chile (6,141 mt) and the US (1,280 mt) the main sources, with 68% and 14% of these imports, respectively. According to Russia's Federal Customs Service, 1,000 mt was from Argentina (11% of the total); 340 mt (3.8%) from China; and 220 mt (2.4%) from Bolivia.

Extraction From Reservoir Brines

“If it is true that the country’s provision is on the line, it should be a stimulus for the localization of lithium deposits in the country, and it will, probably,” the Russian lithium industry source said.

The country is already testing direct lithium extraction from reservoir brines at the Kovykta gas field in the Irkutsk region in Siberia, under a joint project between Gazprom and Irkutsk Oil Company, which S&P Global reported in February.

“I believe that spodumene concentrate can be produced from one of the largest in Russia (and still not developed) deposits of spodumene pegmatites, Kolmozerskoye,” the source said, referring to the location north, near Kolmozero Lake, in the Murmansk region, on the Kola Peninsula.

It contains enough to meet Russia's requirements in lithium raw material. It would have been unprofitable to develop 20 years ago, but is worth a go in the current market, the source added, saying putting its license up for bids could be a matter of months.

The volume of Kolmozerskoye lithium content is not yet disclosed, although the US Geological Survey has previously estimated total Russian lithium resources of 1 million mt.