LFP Batteries

Canada currently has no active phosphate mines or processing facilities for the purified phosphoric acid (PPA) which is critical for producing lithium iron phosphate (LFP) batteries for electric vehicles and battery storage. LFP is a crucial technology for a low carbon economy.

LFP batteries are one of the battery technologies favored by many mainstream electric vehicle (EV) manufacturers including Tesla and BYD. The International Energy Agency states the market share for LFP batteries rose to 40% of EV sales and 80% of new battery storage in 2023.

Demand for LFP batteries is on the rise as automakers look for ways to further reduce the cost of EVs. Hyundai, Honda, and VW are all expected to begin using LFP batteries in some models in 2025.

The automotive sector currently represents about 5% of PPA demand, but that number is expected to jump to 24% by 2030. This emerging demand will need to be satisfied by new supplies of phosphoric acid and PPA.

Furthermore, next-generation LFP and lithium manganese iron phosphate (LMFP) cathode chemistries are more energy dense, lower cost, and safer. Demand for these chemistries is expected to increase going forward.

Globally, greater than 2MMt P₂O₅ of PPA is needed to meet projected LFP cathode active material (CAM) demand by 2040.

Securing raw material supply to meet increased demand for batteries will continue to be a trend in coming years, with attention from automakers now turning to the phosphoric acid supply chain to produce the CAM.

As with some other battery raw materials, China has a dominant position in refining phosphate rock into PPA. The country had two-thirds of the global capacity in 2022. In January 2025, China announced it would consider restricting exports of key technologies used to produce the CAM used in LFP batteries.

Since 2020, Canada has attracted more than $46 billion in investments across the EV supply chain and up to $52.5 billion of corresponding support from federal and provincial governments.

To ensure the continued adoption of LFP batteries for EVs and battery storage and the transition to a low carbon economy securing sources of PPA supply outside of China is becoming a pressing necessity for North America.