Zijin Mining's B side: After production drops to zero, the lithium business reopens the floodgates

What strategic adjustments are behind AI · Zijin Mining’s lithium production fluctuations?

“Mining Guru” Zijin Mining (601899.SH/2899.HK) reports its 2025 outlook—achieving an annual revenue of 349.1 billion yuan, up 15% year-over-year; net profit attributable to shareholders of 51.8 billion yuan, up 62%.

While core mineral outputs like gold and copper continue to grow, Zijin Mining produced 25,500 tons of lithium carbonate equivalent in 2025. In 2024, Zijin Mining did not produce any lithium.

The annual report shows that in 2025, Zijin Mining’s lithium output mainly comes from the Lagqu Lake Salt Lake Lithium Mine, 3Q Salt Lake Lithium Mine, Xiangyuan Hard Rock Lithium Mine, and the completion of the acquisition of Zangge Mining’s control rights.

Zijin Mining reaffirmed its goal to become one of the world’s leading lithium producers by 2028. Shell Finance’s reporter noted that the company also raised its production plan, adjusting the expected lithium output for 2028 to 270,000–320,000 tons of lithium carbonate equivalent. In last year’s annual report, the target for 2028 was 250,000–300,000 tons of lithium carbonate equivalent.

Zijin Mining’s main product output plan. Chart / Company’s 2025 Annual Report

Lithium is regarded by Zijin Mining as a future new growth driver. The company began acquiring 3Q Salt Lake in 2021 to strategically enter this sector, completing several major lithium project acquisitions in 2022. However, the company’s lithium output has fluctuated in recent years. In 2023, it was 3,000 tons of lithium carbonate equivalent, but in 2024, it was zero.

At last year’s earnings briefing, Zijin Mining’s then Vice Chairman and President Zou Laichang stated that entering the lithium sector was a very important strategic move for the company. He emphasized that adjusting production levels does not mean exiting the sector, and that developing lithium resources remains aligned with the company’s overall strategic direction. The main reasons for adjustments are market conditions and project approval statuses. For example, salt lake lithium extraction requires tailored strategies for each project, necessitating process and equipment upgrades to withstand current lithium price declines.

Zou Laichang said at the time that they aim for lithium projects to show initial results by 2025, contributing to the company, with significant progress expected in about three years.

At the earnings briefing on March 23 this year, Zijin Mining’s Vice Chairman and President Lin Hongfu listed lithium alongside gold and copper as key mineral varieties for important development.

Lin Hongfu explained that Zijin’s choice of minerals is based on three criteria: rarity, appropriate scale, and alignment with future industry demand. “If two of these conditions are met, there is value in expansion; if all three are met, it’s a priority for the company to develop that mineral.”

In recent years, disruptions in resource supply have highlighted the strategic importance of lithium, often called the “white oil” of the new energy era. Zijin Mining stated that leading mining companies’ increasing investments in lithium resources reflect strong confidence in its long-term prospects. Long-term, the stable dual-driven pattern of new energy vehicles and energy storage, the accelerated commercialization of solid-state batteries, and new demand scenarios like AI data centers are expected to push lithium demand beyond 3 million tons by 2030. Ensuring lithium resource supply security has become a core issue for major economies and industry chains worldwide.

However, compared to these optimistic future prospects, Zijin Mining’s lithium segment revenue in 2025 is relatively modest. Gold and copper still support about 80% of the company’s revenue and gross profit. Gold sales accounted for 44.43% of revenue (net of offsets), with a gross profit share of 40.89%; copper sales made up 27.62% of revenue, with a gross profit share of 34.49%.

Outer ring shows gross profit share, inner ring shows revenue share. Chart / Beijing News Shell Finance Reporter Zhu Yueyi

According to Shanghai Nonferrous Metals Network, on March 23, the average price of battery-grade lithium carbonate was 146,500 yuan/ton. As lithium prices currently fluctuate upward, Zijin Mining’s lithium business is expected to see increased profit margins.

Zou Laichang previously estimated that after the technical upgrades of the “Two Lakes, Two Mines” main lithium projects are completed, the comprehensive cost of the Lagqu Lake Salt Lake project will be roughly within 50,000 yuan per ton; the 3Q Salt Lake project’s cost will be around 75,000 yuan per ton; Xiangyuan Lithium Mine’s cost is about 60,000 yuan per ton; and the Manono Lithium Mine’s cost ranges from 50,000 to 60,000 yuan per ton.

Beijing News Shell Finance Reporter Zhu Yueyi

Editor Wang Jinyu

Proofreader Mu Xiangtong