Introduction

Our firm was engaged to conduct a comprehensive supply chain optimization study for a leading North American lithium producer developing a new lithium hydroxide production facility. The project scope involved evaluating and recommending optimal transportation routes and modes for importing spodumene concentrate from West Africa and Canada. With production scheduled to begin in 2026, the client needed a detailed analysis of multi-modal logistics options, including vessel, rail, barge, and truck transport, to ensure reliable, cost-effective delivery of raw materials. The engagement focused on optimizing rail solutions, given the facility’s location and significant volume requirements of approximately 195,000 metric tons annually.

At A Glance

The consulting delivered expert supply chain analysis and recommendations for a major lithium producer, evaluating over 20 different origin-destination routing combinations to identify the most efficient and economical transportation solutions. Our deep logistics expertise enabled a comprehensive assessment of all viable options while focusing on rail as the primary mode of transport.

Requirements

  • Analyze and optimize inbound logistics for 195,000 MT annual volume of spodumene concentrate
  • Evaluate multi-modal options with emphasis on rail solutions from U.S. ports and Canadian origin
  • Develop actionable recommendations for transportation mode selection and terminal operations

The Challenge

The client faced complex logistics challenges in establishing reliable supply chains for their new Tennessee facility. Raw materials needed to be transported from two distinct origins – West Africa and Quebec – requiring careful evaluation of various ports, terminals, and inland transport options. Rail service was critical given the facility’s inland location and high volume requirements, but the site was served by only one Class 1 railroad, creating potential service risk. Additionally, the specialized nature of the cargo required careful consideration of material handling capabilities at terminals and transload facilities. The project team needed to analyze numerous vessel, rail, barge, and truck routing combinations while accounting for transit times, handling requirements, storage needs, and total delivered cost to identify optimal solutions.

PraxiChain Solution

  • Conducted comprehensive analysis of 9 ports, three railroads, and multiple terminal options to determine the most viable routing combinations
  • Evaluated detailed rail economics, including line-haul rates, fuel surcharges, car supply, and transit times
  • Developed terminal strategy recommendations focused on rail-served facilities with adequate storage capacity
  • Created detailed cost models comparing various modal combinations to identify the lowest total delivered cost options
  • Provided specific recommendations for rail fleet sizing and equipment requirements

Results

Our consulting team identified optimal logistics solutions centered on rail transport from strategic port locations through rigorous analysis and leveraging deep transportation expertise. The recommended solution for West African origin material, utilizing rail service from a Southeast port, provided significantly lower total delivered cost than other modal combinations. While direct rail service offered operational advantages for Canadian-origin material, our analysis showed that a combined vessel-rail solution through a U.S. port could provide meaningful cost savings over direct rail options. The recommendations included specific terminal requirements and rail fleet sizing tailored to each routing option. These solutions provide the client with reliable, cost-effective logistics while maintaining operational flexibility through carefully selected alternate routing options. Our detailed implementation roadmap gives the client a clear direction for establishing their supply chain operations ahead of the 2026 startup.