Lithium’s having a whale of a time as AI demand surges

Please note, this interview was recorded Wednesday 6 May 2026

When I think about lithium, I think electric vehicles, batteries, and even the dancing humanoid robots that have been flooding our feeds as of late.

It has become a defining commodity theme of the past decade and it’s also had one of the more brutal runs of any commodity in recent memory. Up explosively during the EV boom, then dipping back down as quickly as it rose, it’s the kind of investment that can make investors very gun-shy.

This is what brought me to sit down with ETF Shares Chief Operating Officer and Portfolio Manager William Taylor, and the conversation made me re-evaluate what I knew about lithium.

Yes, EVs and batteries still matter. However, Taylor believes the next major source of lithium demand may increasingly come from somewhere else entirely: AI infrastructure.

Taylor's argument, in short, is that the demand story is bigger and broader than most investors realise, and he had one statistic that I couldn't forget:

"The weight of the amount of lithium required in one of these AI data centres is more than the size of a blue whale."

In this interview, Taylor outlines why AI data centres and humanoid robots are becoming major lithium demand drivers, and why he thinks the supply side is not ready for what comes next.

Interview Summary

From rollercoaster to reset

Taylor does not shy away from how ugly the last lithium cycle became. The 2022 boom encouraged a wave of new supply, with miners rushing into the market and ultimately overwhelming demand.

“There was a really exuberant time in 2022 and a lot of miners came online, flooded the market, and unfortunately, caught itself up in a bubble,” he said.

The result was brutal with lithium eventually falling around 80% into the October 2025 lows. However, Taylor believes the washout has fundamentally reset the market.

“Since then there’s kind of been a reset, a recalibration and it’s now rebounded and the market’s definitely in a healthier place.”

For investors who have been watching from the sidelines, Taylor believes that reset may have created an opportunity worth paying attention to again.

Why AI data centres are changing the demand story

While EVs remain central to the lithium story, Taylor believes investors are underestimating the impact AI infrastructure could have on future demand.

“What we’re seeing with AI is actually a development from that,” he said.

Specifically, Taylor pointed to the battery systems needed to support AI data centres. Advanced AI chips consume enormous amounts of power during training and computation, creating sudden surges in electricity demand that need to be stabilised.

The battery systems required to manage that are enormous in scale – far larger than anything most investors picture when they think about lithium demand.

“A lot of these chips require a lot of power to do the training, the computation,” Taylor explained. “When that surge comes through, these batteries, what they do is they act as a shock absorber.”

Taylor sees this as a structural tailwind rather than a short-term theme, and one that sits on top of existing EV demand rather than replacing it.

“Over the next five to 10 years, we’ll really see more and more demand in this area.”

The next demand wave may already be forming

Taylor also highlighted another emerging source of demand he believes investors have yet to fully appreciate: humanoid robotics.

"Each robot has around two to two and a half kilos of lithium," he said.

If adoption reaches projected levels, Taylor believes the lithium required could become significant, particularly when combined with existing EV and AI-related demand growth. Critically, he does not think any of it is priced in yet.

At the same time, he argues the supply side may struggle to respond quickly enough. Refining capacity, he says, has been chronically underinvested, and unlike some industries, you cannot simply switch production on when demand arrives.

"There's probably been an underinvestment in that space. You can't just turn it on overnight. These things take lots of time. In a response to increased demand, supply won't follow shortly – there will be a lag. That's definitely something which I think the market's underestimating."

That combination of multiple accelerating demand drivers and a supply side that cannot keep pace creates the potential for significant bottlenecks and, for investors positioned ahead of it, a meaningful opportunity.

Why miners, and why a basket

VOLT focuses specifically on the mining segment of the lithium supply chain – a deliberate choice, Taylor says, that comes down to where the real pricing power sits.

“We specifically targeted the mining part of the battery value chain and that was strategic,” he said. “That’s the area where scarcity is at its highest and where there’s scarcity, it means you have pricing power.”

Taylor argues mining is also where margins are strongest within the broader lithium supply chain.

The portfolio spans explorers, developers, extractors and refiners across Australia, the US, Canada, Chile and Argentina. A 40% revenue filter is designed to screen out the more speculative end of the market, avoiding companies that are, as Taylor puts it, “more a slide deck and a dream than actually feasible miners that can produce cashflow.”

On the risk side, Taylor highlights political risk in less-developed mining jurisdictions, uncertainty around whether hard rock or brine extraction will dominate long-term, and project delays.

That is precisely why he prefers basket exposure over concentrated single-stock bets.

“You’re moving away from just company specific and you’re actually getting exposure to the entire industry and the trends of the industry.”

Where VOLT sits in a portfolio

For investors already holding broad global equity ETFs, Taylor argues the overlap with VOLT is likely to be minimal.

"If you're holding a broad ETF, it's very likely you're going to have minimal companies that are also in this basket. You might have a PLS or a Liontown, for example, but if you're holding more on the global, it's going to be very limited."

He sees VOLT as a satellite position rather than a core holding, designed to sit alongside a global portfolio and add exposure most investors simply do not have.

"This is a great way to diversify your portfolio and give it a kind of a turbo boost. It's giving your portfolio something different, which you probably don't already have."