Sept 30 (Reuters) – Albemarle Corp said on Thursday it would buy China-based Guangxi Tianyuan New Energy Materials Co Ltd, a lithium converter, for about $200 million as the company looks to increase its lithium conversion capacity.

Demand for battery-grade lithium compounds are expected to increase, especially in transportation, as governments and individual consumers try to reduce their carbon footprint.

Tianyuan's operations include a recently constructed lithium processing plant near the Port of Qinzhou in Guangxi, China. The plant is expected to begin commercial production in the first half of 2022.

Albemarle, the world's top lithium producer, said it expected the deal to close in early next year.

Earlier this month, the company said it expects a steep jump in 2022 earnings, as global efforts to combat climate change drive a surge in demand for the battery component used in electric vehicles. (Reporting by Sahil Shaw in Bengaluru; Editing by Shailesh Kuber)