 "File photo of an automotive lithium-ion battery. Photo: Reuters")
India is planning to link the price of domestic lithium to the weekly prices of lithium hydroxide monohydrate published by the London Metal Exchange (LME), according to a report in The Economic Times (ET). Currently, there is no uniform criterion for estimating the value of lithium or rare earth elements (REEs) found in the country.
The move to peg the prices comes after the Geological Survey of India (GSI) explored the blocks of REEs and lithium in the country.
Bidding for these blocks cannot be conducted currently without uniform standards, as the revenue distributed to states from mining is linked to the average sale price (ASP) of a metal.
“An amendment has now been drafted to the Minerals (Other than Atomic and Hydro Carbons Energy Minerals) Concession Rules, 2016 that suggests how to calculate the price of lithium and rare earth elements extracted in the country,” a senior government official told ET.
The Indian Bureau of Mines will be asked to publish the ASP of rare earth oxide after referring to the basis on which prices are published by the United States Geological Survey (USGS).
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With the push toward adopting electric vehicles and decarbonisation, the demand for lithium and REEs has risen globally. REEs are widely used in the production of electronic devices.
The methodology for arriving at the ASP of many in-demand metals has been mentioned in the existing Mineral Concession Rules. The settlement price of copper, lead, nickel, tin, aluminium, and zinc on the LME is used as a parameter to fix Indian prices. For gold and silver prices, the London Bullion Market Association auction price is taken.
India is projected to have 13.07 million tonnes of in-situ monazite (containing approximately 55-60 per cent total rare earth elements oxide) resources in the coastal sands of Kerala, Tamil Nadu, Odisha, Andhra Pradesh, Maharashtra, and Gujarat, and in the inland placer deposits in parts of Jharkhand, West Bengal, and Tamil Nadu, according to official estimates.
If approved, the proposed pricing methodology will help state governments in fixing the ASP and value of estimated resources (VER) mineral blocks.
