How Will Uncertainty in Greenland Shape American Lithium Production?

 

 

At a time when lithium is in greater demand than ever, and countries are seeking to secure their own mineral supplies, the geopolitical uncertainties that currently hang over Greenland threaten to shake up the global lithium market. The United States and its companies have so far focused on lithium production within its own borders by making use of direct lithium extraction (DLE) technologies, but tensions and the possibility of future exploration in Greenland could see it change course.

 

IDTechEx's new "Direct Lithium Extraction 2026-2036: Technologies, Players, Forecasts" report forecasts the US will be a leading player in the global DLE space, which will fuel the growth of the lithium market to a value of US$52 billion globally by 2036. However, the exact role the US plays in this market will be shaped by what the future holds for Greenland.

 

 

 

 

DLE refers to a series of specialized processes that aim to extract lithium from brines quickly, efficiently, and sustainably. This is done through the use of customized materials including sorbents, solvents, and membranes which can selectively extract lithium from a wide range of brine types. The resulting process is highly efficient with lithium yields of over 80% and can be done in just hours or days.

 

This is in stark contrast to the conventional lithium extraction methods of hard rock mining and brine evaporation, both of which have challenges that make them difficult to scale. Hard rock mining makes use of unsustainable mining practices, with only moderate yield, and relies on intensive post-processing (most of which is controlled by China) to arrive at a battery-grade lithium product. Meanwhile, brine evaporation requires high land use for evaporation ponds and leads to significant losses of water from the ecosystem. It also offers the lowest lithium yield while requiring 12-24 months to sufficiently concentrate brines for extraction.

 

It is for all these reasons that DLE has seen increasing popularity and investment around the world, especially for brand new lithium projects to keep up with demand.

 

 

The US does have lithium-bearing brines within its borders, but these are generally not suitable for evaporation, which needs brines to have high lithium content with low levels of impurities. Instead, American brines are often either geothermal brines (at high temperature with quantities of potassium and boron contaminants) or oilfield brines (very low lithium contents with remnants of sulphur or hydrocarbon contamination from oil & gas exploration).

 

Therefore, in order to meet lithium demand for EV and energy storage battery cells, and to localize supply chains, the US has had to turn to DLE technologies. It saw its first commercial-scale DLE plant enter operation in 2025, with the new IDTechEx report highlighting many more in the planning or development stages. This includes projects in Nevada, Arkansas, Texas, Louisiana, Utah, and North Dakota.

 

 

Recent political tensions in Greenland have highlighted the bounty of critical mineral deposits that Greenland has to offer, including key battery materials such as lithium as well as nickel, cobalt, and graphite. Greenland's lithium comes in the form of hard rock deposits, the first of which were only unearthed in 2024. Further geological exploration is still being carried out, but surveys to date suggest that these are high purity deposits with good potential to be profitable. Pilot plant projects are already being planned to tap into them, with construction possibly starting in 2026.

 

This places American lithium production at a crossroads. With the possibility of increasing American influence over Greenland and its resources, American companies may be incentivized to exploit these hard rock deposits instead of domestic brine sources. Hard rock mining of lithium is a mature and well understood process responsible for the majority of global production, while DLE is more novel and comes with greater financial risk, requires higher CAPEX, and demands more significant R&D capabilities for development (especially for geothermal and oilfield brine DLE which are even less developed).

 

With the US expected to be a major DLE player in the short-term, a move like this would dampen the market for DLE projects and materials, while also stripping away the sustainability benefits provided by DLE processes.

 

However, Greenland's deposits come with their own challenges too. For one, hard rock mining still comes with a degree of risk (albeit lower than DLE) and there are no guarantees that these deposits will be profitable - this will depend on factors including deposit quality, location, ease of extraction, and more.

 

Additionally, American resource companies would still be required to expand their own post-processing capacity in order to produce battery-grade products without relying on Chinese partners. Finally, hard rock mining is still less efficient than DLE, and this gap will continue to widen as DLE technology sees greater innovation globally. American manufacturers may feel that the higher risk of DLE projects is worth taking on for the potential upside they can provide.

 

 

IDTechEx expects that the US will continue to expand its DLE capabilities over the next decade as the technology gains greater maturity and comes down in its risks and costs. However, the scale of expansion and investment in this area will likely depend on the outcome of current political tensions and how quickly they can be resolved.

 

 

For more information on this report, including downloadable sample pages, please visit www.IDTechEx.com/LithiumExtraction, or for the full portfolio of related research available from IDTechEx, including critical minerals and batteries, see www.IDTechEx.com.