Top 5 ASX lithium shares to watch in 2025

What are lithium shares?

Lithium shares are the stocks of publicly listed companies that are involved in the mining and refining of lithium, as well as processing lithium-based products, like electric vehicle (EV) batteries.

What is lithium and how is it used?

Lithium is a silvery-white alkali metal with special properties that make it extremely useful in the production of lithium-ion batteries that act as the power source for EVs.

Because lithium is both the least dense metal and the least dense solid element, it is highly unlikely to be replaced in modern EVs by alternatives such as nickel. While nickel has been used in the past, it has a 40% lower energy density, meaning more of the metal is required to create an EV battery.

However, lithium’s chemical disadvantage is its inherent instability. Lithium is highly reactive and must be stored in an inert atmosphere or vacuum, such as oil. This makes it expensive to produce, transport and store.

ASX lithium shares: what you need to know

One concern about lithium is that it’s relatively abundant worldwide. However, supply is restricted for two reasons.

The first is that lithium needs to be concentrated enough to be worth mining, and exploratory projects are often expensive with a high failure rate.

The second is that lithium is difficult and time-consuming to mine, with new mines taking up to ten years to begin extraction. While corporations worldwide are attempting to establish their own mining and processing operations, the demand for lithium is likely to outpace the supply ramp-up.

There are multiple ways to trade ASX lithium shares. It’s worth noting that lithium is mined from three types of deposits: brine, pegmatite lithium and sedimentary, with Australia accounting for the majority of the sedimentary lithium worldwide. Many lithium traders prefer to invest across all three types.

Advantages of lithium shares

There are some real benefits to trading lithium shares. Let’s take a look at a few:

• Demand: As the demand for EVs ramps up, with governments around the world looking to ban the sale of fuel-based vehicles, lithium is bound to be highly sought-after – unless vehicle technology takes a major leap in another direction
• Sustainability: By trading lithium shares, you’re investing in a cleaner future
• Diversification: There are numerous ways to get involved in lithium shares, from mining companies to production stocks. And they’re not just on the ASX – they’re all over the world

Risks of lithium shares

As appealing as lithium shares may seem, there are certain downsides to trading them, too:

• Volatility: Aside from the bullish surge in early August 2025, the lithium market has been fraught with turmoil this year. It’s a volatile market despite the growing demand for EVs
• Regulations: As the need for more lithium to power EVs grows, regulatory changes are bound to take place
• Supply chain risks: Lithium companies are largely at the mercy of countries like China, which is frequently affected by supply chain risks. One reason for this is the repeated lockdowns associated with contagious diseases spreading

Top 5 ASX lithium shares to watch in 2025

Now is a particularly interesting time to keep an eye on ASX-listed shares. The price of lithium stocks recently surged, thanks, in part, to battery manufacturer Contemporary Amperex Technology (CATL) suspending production at a major Chinese mine for at least three months, beginning in August 2025.¹

The lithium price has seen an extended period of decline in 2025, but is now showing signs of life again.

Overview of the shares in this article

We chose the shares in this list based on the highest market cap of ASX-listed lithium companies. All of these stocks can be share traded directly or via CFDs with us.

1. Mineral Resources Limited (ASX: MIN)

Market cap: A$7.31 billion²

Founded in 2006, Mineral Resources has evolved from a mining services provider into a diversified resources company with extensive lithium operations in Western Australia. The company operates the Wodgina lithium mine and owns a 50% stake in the Mt Marion lithium operation.

Its shares jumped 40% recently following the Chinese mine closure (as well as a levelling out of Chinese oversupply issues), signalling that now is an excellent time to keep an eye on Mineral Resources.³

Its FY25 volume and cost guidance has thus far been achieved, and its liquidity is in excess of A$1.1 billion.⁴

Its future plans include expanding processing capabilities and exploring downstream integration opportunities, while maintaining financial discipline.

Highlights:

• The most recent quarterly update indicates that June production at the Onslow ore project was excellent – 2.7 million tons of iron ore shipments⁵
• The company has responded to the difficult lithium market this year by cutting operational costs, particularly at Wodgina mine
• Mineral Resources controls multiple stages of the lithium supply chain, including mining, processing and developing lithium conversion and battery manufacturing facilities

2. Pilbara Minerals Limited (ASX: PLS)

Market cap: A$7.43 billion⁶

Established in 1998, Pilbara Minerals operates the flagship Pilgangoora lithium-tantalum operation in Western Australia's Pilbara region. The company has become one of the world's largest independent lithium producers.

Much like Mineral Resources, Pilbara has also recently implemented cost-cutting measures in response to 2025’s lithium prices. And, similarly, its share price soared 25.88% between 7 August and 13 August 2025.

Despite EV headwinds, the company continues to expand its production capacity, planning to double the spodumene output at its Pilgangoora operation in the coming years. A feasibility study is set to conclude in the last quarter of 2025, after which it seeks to increase production to over 2 million tons per year.

Highlights:

• Its June 2025 quarter highlights include a 77% increase in production quarter over quarter (QoQ)⁷
• In the same time frame, it generated A$193 million in revenue⁸
• It's thus far on track to achieve FY25 guidance⁹

3. IGO Limited (ASX: IGO)

Market cap: A$4.11 billion¹⁰

IGO's primary lithium operations centre on the Greenbushes lithium mine in Western Australia, operated through a joint venture with Albemarle and Tianqi Lithium. This is one of the world's largest hard-rock lithium operations.

The company also holds significant nickel assets, including the Nova nickel-copper mine and a stake in the Forrestania nickel operations.

In addition, IGO owns the Cosmos nickel operation and has copper interests through its Silver Knight project.

Its latest quarterly results show an underlying EBITDA of A$62 million and positive cash flow from operating activities of A$4 million.¹¹

Its share price jumped 14.10% in early to mid-August 2025.

Future strategies will focus on optimising existing operations while evaluating new battery metals opportunities.

Highlights:

• In the June 2025 quarter, it showed a strong balance sheet with A$280 million cash on hand¹²
• Greenbushes operation achieved an EBITDA margin of 60% for the quarter¹³
• Shipments from the previous quarter at Greenbushes and Nova were delayed, leading to greater sales in the latest quarter¹⁴

4. Liontown Resources Limited (ASX: LTR)

Market cap: A$2.43 billion¹⁵

Liontown Resources, established in 2006, develops the Kathleen Valley lithium project in Western Australia. The company officially opened the operation in April 2025 in a landmark ceremony, marking its transition to production.

The Kathleen Valley operation is one of Australia's newest lithium mines, designed to produce approximately 700,000 tons per year of spodumene concentrate at full capacity.

Recent challenges include having to resell material originally earmarked for Ford Motor Co, highlighting supply chain complexities. However, Liontown led recent sector gains with nearly 25% share price increases.¹⁶

The company plans to ramp up production at Kathleen Valley while exploring expansion opportunities.

Highlights:

• It plans to achieve 100% underground production by Q3 FY26¹⁷
• Net cash from operating activities was A$23 million in the June quarter of FY25¹⁸
• In the same period, revenue was A$301 million¹⁹

5. Vulcan Energy Resources (ASX: VUL)

Market cap: A$940.06 million²⁰

Vulcan Energy has a unique approach to lithium extraction – through geothermal brine in Germany's Upper Rhine Valley. The company's unique dual-revenue model produces both lithium chemicals and renewable geothermal energy from the same resource. Its direct lithium extraction (DLE) technology processes geothermal brines at temperatures up to 200°C, extracting lithium while reinjecting the brine back underground to maintain the geothermal reservoir.

This process significantly reduces environmental impact compared to conventional lithium production methods.

It seeks to supply lithium chemicals and renewable energy from Europe, for Europe, having signed partnerships with companies like Renault Group.

Recent progress includes commencing new Phase One geothermal energy-lithium wells in May 2025, advancing its innovative zero-carbon extraction technology.

Highlights:

• Started drilling for the first new well for the Schleidberg site in the June quarter. This is the fifth well in the area²¹
• Recently got approval for building permits for a 30MW geothermal renewable energy plant and electrical substation that form part of the Schleidberg Project²²

How to trade lithium shares with IG AU

CFDs

1. Open a CFD trading account with IG AU
2. Search for ASX lithium shares on the IG platform
3. Decide whether to go long (buy) or short (sell)
4. Choose your position size
5. Set stop-loss and limit orders
6. Place your trade and monitor it

Share trading

1. Open a share trading account with IG AU
2. Search for ASX lithium shares
3. Choose the shares you want to buy
4. Determine how many shares you want to purchase
5. Place your order
6. Monitor your investment and collect any dividends

FAQs about lithium shares

Footnotes
 

1. Mining Weekly, August 2025
2. TradingView, August 2025
3. Discovery News, August 2025
4. Mineral Resources quarterly update, July 2025
5. Discovery Alert, August 2025
6. TradingView, August 2025
7. Pilbara Minerals quarterly report, July 2025
8. Pilbara Minerals quarterly report, July 2025
9. Pilbara Minerals quarterly report, July 2025
10. TradingView, August 2025
11. IGO quarterly results, July 2025
12. IGO quarterly results, July 2025
13. IGO quarterly results, July 2025
14. IGO quarterly results, July 2025
15. TradingView, August 2025
16. Mining Weekly, August 2025
17. Liontown quarterly results, July 2025
18. Liontown quarterly results, July 2025
19. Liontown quarterly results, July 2025
20. TradingView, August 2025
21. Vulcan quarterly activities, July 2025
22. Vulcan quarterly activities, July 2025
23. International Lithium Association, May 2025