On the final working day before the Dragon Boat Festival, the Contemporary Amperex Technology Co.,Ltd. (CATL) (SHE: 300750/HKG: 03750) Jianxiawo mining project, a focal point for the lithium market, saw a new development.

On June 18th, the Jiangxi Provincial Department of Natural Resources issued a land use pre-approval and site selection administrative permit, titled "Project Land Use Pre-approval and Site Selection Opinion Letter of the People's Republic of China." The administrative counterpart named is Yichun Times New Energy Mining Co., Ltd., an indirectly controlled subsidiary of CATL. This permit decision takes effect from June 17, 2026, and is valid until June 17, 2029.

This administrative permit corresponds to the Zhenkouli-Fengxin Jianxiawo lithium mining project in Yifeng County, Jiangxi Province. Notably, the original opinion letter was announced as cancelled by the Jiangxi Provincial Department of Natural Resources on June 8th, following a prior active application by Yichun Times. The "Project Land Use Pre-approval and Site Selection Opinion Letter" is a statutory prerequisite document for project implementation.

The production halt at the Jianxiawo lithium mine began nearly ten months ago. On the morning of August 11, 2025, CATL publicly confirmed that mining operations at its Yichun project had been suspended following the expiration of the mining license on August 9, 2025. Regarding the project's restart, CATL stated at the time that it was processing the application for the mining license renewal as per relevant regulations and would resume production as soon as possible upon approval.

On April 20, 2022, Yichun Times successfully won the bidding for the exploration rights of ceramic clay (containing lithium) in the Zhenkouli-Fengxin Jianxiawo mining area in Yifeng County, Jiangxi Province, with an offer of 865 million yuan. The exploration area covers 6.44 square kilometers, with inferred ceramic stone resources of 960 million tons and associated lithium oxide resources of 2.6568 million tons, equivalent to approximately 6.57 million tons of lithium carbonate (LCE), making it one of the world's largest single lepidolite mines.

However, lithium ore grades in Jiangxi are generally low, with Jianxiawo's average lithium oxide grade being about 0.27%. Before the halt, the mine's average monthly lithium carbonate production was about 7,000 to 8,000 tons, accounting for roughly one-tenth of domestic demand.

The suspension of the Jianxiawo lithium mine involved multiple overlapping factors. The new "Mineral Resources Law" implemented in July 2025 classified lithium as an independent strategic mineral and set a hard threshold of 0.4% lithium oxide for identifying associated lithium. With the Jianxiawo mining area's average lithium oxide grade of only 0.27%-0.28%, it could no longer be developed under the "ceramic clay with associated lithium" model. The original mining license, land use plan, and environmental impact assessment documents all became invalid. It was necessary to change the primary mineral type to independent lithium ore, pay over 100 million yuan in additional lithium ore transfer revenue, reduce the mining scale to 30 million tons per year, and restart the entire chain of approval materials from scratch.

That same month, the Yichun Municipal Bureau of Natural Resources issued a notice clarifying that eight lithium-related mining rights, including Jianxiawo, had issues such as circumventing superior approval authority and overstepping authority in processing procedures. It required the completion of the preparation of mineral type change reserve verification reports by the end of September that year. These eight projects, including CATL's, accounted for over 80% of China's total lepidolite supply. In August last year, CATL's Jianxiawo mine and Guoxuan High-tech's Geli Shili Shuinan mine were the first to halt production.

At that time, the suspension at the Jianxiawo mining area was also seen by the market as a significant escalation signal for the industry's "anti-internal competition." Stimulated by the suspension news, on August 11, 2025, lithium carbonate futures opened with all contracts hitting limit-up, with the main contract locked at the limit-up price.

Upon the news of regaining the land use opinion letter, capital markets immediately reacted. On June 18, lithium carbonate futures opened and declined throughout the session. At the close, the main contract 2609 was quoted at 160,500 yuan per ton, plummeting 6.58%, down 11,300 yuan per ton from the previous trading day. The day's open interest was 450,964 lots, a decrease of 4,883 lots from the previous day, with intraday capital outflow of 1.712 billion yuan.

The spot market also faced pressure. Shanghai Steel Union data showed that on June 18, the average market price for battery-grade lithium carbonate in early trading fell by 800 yuan from the previous working day to 168,800 yuan per ton.

The A-share lithium mining sector also weakened collectively. As of the close on June 18, CATL's share price fell 1.87% to close at 391.55 yuan. Guocheng Mining (SHE: 000688) fell over 7%, Shengxin Lithium Energy (SHE: 002240) and Dazhong Mining (SHE: 001203) fell over 5%, Yanhu Shares (SHE: 000792) and Tianhua New Energy (SHE: 300390) fell over 3%, while Tianqi Lithium (SHE: 002466) and Ganfeng Lithium (SHE: 002460) fell over 2%.

Although this land use pre-approval only signifies compliance in land site selection for the project, with a complete approval process still pending before formal commencement of construction and ore extraction, it indeed marks a substantive turning point in the rectification process following the Jianxiawo lithium mine's suspension. It is interpreted by the market as a sign of the project getting back on track. Some analysts stated that based on the current progress, it is estimated that CATL's Jianxiawo lithium mine project could resume production in the fourth quarter of this year. However, other views suggest that even if its capacity recovers, it will not alter the overall annual supply-demand dynamic where demand is expected to exceed supply.

Additionally, it is worth noting that the tailings dam for the Jianxiawo lithium mine will be a significant core bottleneck in subsequent project approvals. The low grade of the raw ore, producing tens of millions of tons of lithium slag annually, necessitates supporting large-scale, high-grade tailings ponds. Coupled with the context of stricter environmental supervision for lithium mines in Yichun, even with land use pre-approval obtained, specialized procedures related to tailings will continue to constrain the pace of mining license renewal and infrastructure construction commencement.

The restart path for one of the world's largest single lepidolite mines has taken a step forward, but its true impact on the lithium market's supply and demand structure may only become clear once actual production resumption materializes.