The lithium market is experiencing a major price decline due to rising supply and weaker demand. In February 2025, the lithium carbonate CIF North Asia price fell below $10,000 per metric ton, dropping 4.5% to $9,550/t. This is the lowest level since February 2021. Analysts expect further cuts in production throughout 2025 to balance the market.
The price drop is mainly due to strong production in Chile and a post-holiday demand slowdown in China. Also, new lithium projects in Mali and Argentina boost global supply. This adds to the downward pressure on prices.
Why Are Lithium Prices Falling?
Several key factors contribute to the ongoing decline in lithium prices, ranging from oversupply to shifting market dynamics and policy changes.
Oversupply Floods the Market
Lithium production has been growing rapidly. In January 2025, Chile’s lithium exports increased by 22.8% month over month, flooding the market with additional supply.
Mali’s new lithium mines, Bougouni and Goulamina, will boost lithium output to 40,528 metric tons of lithium carbonate equivalent (LCE) in 2025. This accounts for 2.7% of the global supply.
Additionally, Argentina’s Ganfeng Lithium Group has started production at the Mariana brine project, adding another 17,420 metric tons of LCE annually. Argentina is now the top producer in the Lithium Triangle. This area includes Bolivia and Chile, which hold some of the richest lithium reserves in the world.
Benchmark Mineral Intelligence shows that the global weighted average price for lithium is dropping, as seen in the chart. This change reflects the increase in supply.

China’s Demand Woes
China, the world’s biggest buyer of lithium, saw a sharp decline in demand in early 2025. The Lunar New Year holidays slowed down industrial work. Many battery makers also postponed their purchases. This contributed to a 1.6% price drop for lithium carbonate in China, bringing it down to 76,100 yuan per metric ton by mid-February.
Additionally, the shift to lithium iron phosphate (LFP) batteries—which require less lithium than traditional nickel-based batteries—is reducing lithium demand. Companies such as Tianqi Lithium and IGO Ltd. have already halted expansion at their lithium hydroxide refineries due to weaker market conditions.
Benchmark Mineral Intelligence said lithium prices soared to $81,375 per tonne in China by December 2022. This spike pushed consumers to look for alternatives, such as LFP batteries.
Policy Uncertainty in the U.S.
The future of North America’s lithium supply chain is unclear, adding to the market pressure. The US Inflation Reduction Act (IRA) of 2022 gave tax credits for lithium from Canada and other allied countries.
Now, it is being reconsidered. The Trump administration also suggested a 10% tariff on energy exports from Canada, like lithium. If enacted, these tariffs could make lithium imports more expensive, limiting investment in the sector.
Currently, only 44.7% of US lithium demand is met by domestic production, rising to 76.4% when including Canadian supply. Any policy changes could significantly impact lithium prices and availability in North America.
Cheaper Lithium Sparks a New EV Price War
The decline in lithium prices has had a notable impact on battery manufacturing costs. The falling prices are closely linked to trends in the plug-in electric vehicle (PEV) and battery electric vehicle (BEV) markets.
Slower-than-expected EV adoption in key regions, driven by reduced government incentives and economic uncertainty, has weakened lithium demand. Automakers are adjusting production forecasts, leading to fluctuations in battery material purchases.

Benchmark Mineral Intelligence reports that cell prices have dropped 73% since 2014. This decline comes from higher production volumes, new technology, and lower raw material costs. These factors let battery makers cut prices.
However, lower costs have made EVs cheaper. This could increase demand over time as forecasted below. Yet, the current oversupply of lithium makes it hard for producers to stay profitable.

How the Industry Is Reacting to the Lithium Slump
The prolonged decline in lithium prices has led to significant industry reactions. The industry is responding to the ongoing slump with various strategies aimed at stabilizing the market. Big producers like Albemarle and SQM plan to cut back production. This move aims to stop further price drops.
Some mining companies are delaying new projects, while others are cutting costs to remain profitable in the face of lower revenues. Smaller lithium miners are having a tough time. Those without strong financial support are struggling the most. Some have had to stop operations or look for mergers to survive.
In December 2024, Rio Tinto acquired Arcadium Lithium for €6.2 billion, consolidating its position in the global lithium market. This acquisition occurred amid an excess supply and significantly lower prices since their peak in 2022.
Despite these challenges, major mining companies expect lithium demand to rise in the next decade. This growth will be fueled by the shift toward electric transportation and renewable energy storage.
However, the oversupply is causing problems for smaller companies. Some have cut back or stopped their operations. Cutting subsidies in key countries has slowed EV sales growth. This means that only a production cut may raise lithium prices in the medium term.
Looking Ahead – When Will Lithium Prices Recover?
Despite the current challenges, there is optimism about the future of the lithium market. Industry analysts foresee a future increase in lithium demand, potentially leading to a market shift by the early 2030s, driven by infrastructure projects and the growth of green technology. Notable investments include Exxon Mobil and Tesla, seeking to capitalize on future lithium needs.
Goldman Sachs Research estimates the overall increase in data center power consumption from AI to be 200 terawatt-hours per year between 2023 and 2030. As AI use and high-performance computing grow, the need for lithium-ion batteries will rise. These batteries are key for backup power in big computing facilities.
Notably, S&P Global Commodity Insights predicts that the oversupply will make it hard for lithium prices to go up until the next decade.

The lithium market is facing oversupply and falling prices. This is due to higher global production, reduced demand from key markets like China, and uncertainties in major economies.
While these factors present challenges in the short term, the anticipated growth in electric vehicle adoption and renewable energy storage solutions offers a positive outlook for lithium demand in the long run. Industry stakeholders must navigate these complexities carefully, balancing current market realities with future opportunities.
The post Lithium Prices Crash Below $10K, Hitting a 4-Year Low: Will the Market Rebound? appeared first on Carbon Credits.
Carbon Footprint
Climate Impact Partners Unveils High-Quality Carbon Credits from Sabah Rainforest in Malaysia
The voluntary carbon market is changing. Buyers are no longer focused only on large volumes of cheap credits. Instead, they want projects with strong science, long-term monitoring, and clear proof that carbon has truly been removed from the atmosphere. That shift is drawing more attention to high-integrity, nature-based projects.
One project now gaining that spotlight is the Sabah INFAPRO rainforest rehabilitation project in Malaysia. Climate Impact Partners announced that the project is now issuing verified carbon removal credits, opening access to one of the highest-quality nature-based removals currently available in the global market.
Restoring One of the World’s Richest Rainforest Ecosystems
The project is located in Sabah, Malaysia, on the island of Borneo. This region is home to tropical dipterocarp rainforest, one of the richest forest ecosystems on Earth. These forests store huge amounts of carbon and support extraordinary biodiversity. Some dipterocarp trees can grow up to 70 meters tall, creating habitat for orangutans, pygmy elephants, gibbons, sun bears, and the critically endangered Sumatran rhino.
However, the forest within the INFAPRO project area was not intact. In the 1980s, selective logging removed many of the most valuable tree species, especially large dipterocarps. That caused serious ecological damage. Once the key mother trees were gone, natural regeneration became much harder. Young seedlings also had to compete with dense vines and shrubs, which slowed the forest’s recovery.
To repair that damage, the INFAPRO project was launched in the Ulu-Segama forestry management unit in eastern Sabah.
- The project has restored more than 25,000 hectares of logged-over rainforest.
- It was developed by Face the Future in cooperation with Yayasan Sabah, while Climate Impact Partners has supported the project and helped bring its credits to market.
Why Sabah’s Carbon Removals are Attracting Attention
What makes Sabah INFAPRO different is not only the size of the restoration effort. It is also the way the project measured carbon gains.

Many forest carbon projects issue credits in annual vintages based on year-by-year growth estimates. Sabah INFAPRO followed a different path. It used a landscape-scale monitoring system and waited until the forest moved through its strongest natural growth period before issuing removal credits.
- This approach gives the credits more weight. Rather than relying mainly on short-term annual estimates, the project measured carbon sequestration over a longer period. That helps show that the forest delivered real, sustained, and measurable carbon removal.
The scientific backing is also unusually strong. Since 2007, the project has maintained nearly 400 permanent monitoring plots. These plots have allowed researchers, independent auditors, and technical specialists to observe the full growth cycle of dipterocarp forest recovery. The result is a large body of field data that supports carbon calculations and strengthens confidence in the credits.
In simple terms, buyers are not just being asked to trust a model. They are being shown years of direct forest monitoring across the project landscape.
Strong Ratings Support Market Confidence
Independent assessment has also lifted the project’s profile. BeZero awarded Sabah INFAPRO an A.pre overall rating and an AA score for permanence. That places the project among the highest-rated Improved Forest Management, or IFM, projects in the world.
The rating reflects several important strengths. First, the project has very low exposure to reversal risk. Second, it has a long and stable operating history. Third, its measured carbon gains align well with peer-reviewed ecological research and independent analysis.
These points matter in today’s market. Buyers have become more cautious after years of debate over the quality of some forest carbon credits. As a result, they now look more closely at durability, transparency, and third-party validation. Sabah INFAPRO’s rating helps answer those concerns and makes the project more attractive to companies looking for credible carbon removal.
The project is also registered with Verra’s Verified Carbon Standard under the name INFAPRO Rehabilitation of Logged-over Dipterocarp Forest in Sabah, Malaysia. That adds another level of market recognition and verification.
A Wider Model for Rainforest Recovery
Sabah INFAPRO also shows why high-quality nature-based projects are about more than carbon alone. The restoration effort supports broader ecological recovery in one of the world’s most important rainforest regions.
Climate Impact Partners said it has worked with project partners to restore degraded areas, run local training programs, carry out monthly forest patrols, and distribute seedlings to support rainforest recovery beyond the project boundary. These efforts help strengthen the wider landscape and expand the project’s environmental impact.
That broader value is becoming more important for buyers. Companies increasingly want projects that support biodiversity, ecosystem health, and local engagement, along with carbon removal. Sabah INFAPRO offers that mix, making it a stronger fit for the market’s shift toward higher-integrity credits.

The post Climate Impact Partners Unveils High-Quality Carbon Credits from Sabah Rainforest in Malaysia appeared first on Carbon Credits.
Carbon Footprint
Bitcoin Falls as Energy Prices Rise: Why Crypto Is Now an Energy Market Story
Bitcoin’s recent drop below $70,000 reflects more than short-term market pressure. It signals a deeper shift. The world’s largest cryptocurrency is becoming increasingly tied to global energy markets.
For years, Bitcoin has moved mainly on investor sentiment, adoption trends, and regulation. Today, another force is shaping its direction: the cost of energy.
As oil prices rise and electricity markets tighten, Bitcoin is starting to behave less like a tech asset and more like an energy-dependent system. This shift is changing how investors, analysts, and policymakers understand crypto.
A Global Power Consumer: Inside Bitcoin’s Energy Use
Bitcoin depends on mining, a process that uses powerful computers to verify transactions. These machines run continuously and consume large amounts of electricity.
Data from the U.S. Energy Information Administration shows Bitcoin mining used between 67 and 240 terawatt-hours (TWh) of electricity in 2023, with a midpoint estimate of about 120 TWh.

Other estimates place consumption closer to 170 TWh per year in 2025. This accounts for roughly 0.5% of global electricity demand. Recently, as of February 2026, estimates see Bitcoin’s energy use reaching over 200 TWh per year.
That level of energy use is significant. Global electricity demand reached about 27,400 TWh in 2023. Bitcoin’s share may seem small, but it is comparable to the power use of mid-sized countries.
The network also requires steady power. Estimates suggest it draws around 10 gigawatts continuously, similar to several large power plants operating at full capacity. This constant demand makes energy costs central to Bitcoin’s economics.
When Oil Rises, Bitcoin Falls
Bitcoin mining is highly sensitive to electricity prices. Energy is the highest operating cost for miners. When power becomes more expensive, profit margins shrink.
Recent market movements show this link clearly. As oil prices rise and inflation concerns persist, energy costs have increased. At the same time, Bitcoin prices have weakened, falling below the $70,000 level.

This is not a coincidence. Studies show a direct relationship between Bitcoin prices, mining activity, and electricity use. When Bitcoin prices rise, more miners join the network, increasing energy demand. When energy costs rise, less efficient miners may shut down, reducing activity and adding selling pressure.
This creates a feedback loop between crypto and energy markets. Bitcoin is no longer driven only by demand and speculation. It is now influenced by the same forces that affect oil, gas, and power prices.
Cleaner Energy Use Is Growing, but Fossil Fuels Still Matter
Bitcoin’s environmental impact depends on its energy mix. This mix is improving, but it remains uneven.
A 2025 study from the Cambridge Centre for Alternative Finance found that 52.4% of Bitcoin mining now uses sustainable energy. This includes both renewable sources (42.6%) and nuclear power (9.8%). The share has risen significantly from about 37.6% in 2022.
Despite this progress, fossil fuels still account for a large portion of mining energy. Natural gas alone makes up about 38.2%, while coal continues to contribute a smaller share.

This reliance on fossil fuels keeps emissions high. Current estimates suggest Bitcoin produces more than 114 million tons of carbon dioxide each year. That puts it in line with emissions from some industrial sectors.
The shift toward cleaner energy is real, but it is not complete. The pace of change will play a key role in how Bitcoin fits into global climate goals.
Bitcoin’s Climate Debate Intensifies
Bitcoin’s growing energy demand has placed it at the center of ESG discussions. Its impact is often measured through three key areas:
- Total electricity use, which rivals that of entire countries.
- Carbon emissions are estimated at over 100 million tons of CO₂ annually.
- Energy intensity, with a single transaction using large amounts of power.

At the same time, the industry is evolving. Mining companies are adopting more efficient hardware and exploring new energy sources. Some operations use excess renewable power or capture waste energy, such as flare gas from oil fields.
These efforts show progress, but they do not fully address the concerns. The gap between Bitcoin’s energy use and its environmental impact remains a key issue for investors and regulators.
- MUST READ: Bitcoin Price Hits All-Time High Above $126K: ETFs, Market Drivers, and the Future of Digital Gold
Bitcoin Is Becoming Part of the Energy System
Bitcoin mining is now closely integrated with the broader energy system. Operators often choose locations based on access to cheap or excess electricity. This includes areas with strong renewable generation or underused energy resources.
This integration creates both opportunities and challenges. On one hand, mining can support energy systems by using power that might otherwise go to waste. It can also provide flexible demand that helps stabilize grids.
On the other hand, it can increase pressure on local electricity supplies and extend the use of fossil fuels if cleaner options are not available.
In the United States, Bitcoin mining could account for up to 2.3% of total electricity demand in certain scenarios. This highlights how quickly the sector is scaling and how closely it is tied to national energy systems.
Energy Markets Are Now Key to Bitcoin’s Future
Looking ahead, the connection between Bitcoin and energy is expected to grow stronger. The network’s computing power, or hash rate, continues to reach new highs, which typically leads to higher energy use.
Electricity will remain the main cost for miners. This means Bitcoin will continue to respond to changes in energy prices and supply conditions. At the same time, governments are starting to pay closer attention to crypto’s environmental impact, which could shape future regulations.

Some forecasts suggest Bitcoin’s energy use could rise sharply if adoption increases, potentially reaching up to 400 TWh in extreme scenarios. However, cleaner energy systems could reduce the carbon impact over time.
Bitcoin is no longer just a financial asset. It is also a large-scale energy consumer and a growing part of the global power system.
As a result, understanding Bitcoin now requires a broader view. Energy prices, electricity markets, and carbon trends are becoming just as important as market demand and investor sentiment.
The message is clear. As energy markets move, Bitcoin is likely to move with them.
The post Bitcoin Falls as Energy Prices Rise: Why Crypto Is Now an Energy Market Story appeared first on Carbon Credits.
Carbon Footprint
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