American Battery Technology Co (ABTC) expects its upcoming commercial-scale production of battery-grade lithium hydroxide in the United States to significantly benefit domestic cathode manufacturers by improving inventory management and reducing lead times.

Ryan Melsert, CEO of ABTC, highlighted that most cathode plants being constructed in the US and Canada will produce high-nickel cathode, which requires lithium hydroxide as a raw material. Currently, there is virtually no lithium hydroxide produced in the US, and the product has a short shelf life of about six months.

Melsert explained the challenges of importing lithium hydroxide: "If you have a cathode plant in the US or Canada, and you have to ship hydroxide from inland China, you can eat up two or three months of shelf life before it even gets to your factory, and then you'll have two to three months left until it expires, essentially.

" He added that companies are very interested in sourcing domestically because ABTC can deliver the product to their plants within days, giving them more time to use it in their facilities.

ABTC recently announced successful production of demonstration-scale quantities of lithium hydroxide at its Tonopah, Nevada facility, using processing technologies to extract lithium from claystone.

The company is now accelerating the construction of its commercial-scale lithium refinery at Tonopah, which is expected to produce 30,000 tonnes per year of lithium hydroxide at full capacity. Production is scheduled to begin early next year.

In addition to its lithium hydroxide production, ABTC operates a recycling plant at the Tahoe Reno Industrial Center in Nevada, with an initial capacity to process 20,000 tonnes per year of battery feedstock material. The company has partnered with BASF and Nanotech Energy to create a closed-loop system for lithium-ion battery production in North America.

Melsert emphasized the synergy between ABTC's primary lithium production and recycling operations, noting that the lithium hydroxide plant is expected to produce more lithium than all other recycling plants in the US combined. This dual approach appeals to automotive manufacturers who value both sustainability and scale.

Following ABTC's announcement, US Department of Energy Secretary Jennifer Granholm visited the company's facilities to discuss its business plan and the importance of domestic lithium production. The company has received six rounds of funding from the DoE and recently secured over $60 million in tax credits through the Qualifying Advanced Energy Project Credits program.

ABTC plans to sell most of its lithium hydroxide production to cathode refiners through long-term agreements with commodity price corrections, while reserving a portion for spot market sales. Melsert believes that both lithium iron phosphate (LFP) and nickel-manganese-cobalt (NMC) batteries will continue to coexist in the market, catering to different consumer needs.