Australia has long been the major supplier of raw lithium concentrate [1] - sending it on to either China or Malaysia [2].
Soon we'll be shipping concentrate to Texas [3] [4] [5] so that the filthy dirty toxic work of heavy rare earths separation can take place as close to the greedy end consumers as possible.
[1] https://www.bbc.com/future/article/20221110-how-australia-be...
[2] https://lynasrareearths.com/
[3] https://www.mining-technology.com/news/lynas-heavy-rare-eart...
[4] https://thetexan.news/rare-earths-processing-plant-to-open-o...
[5] https://www.miningmagazine.com/supply-chain-management/news/...
As to externalities, no one said that there shouldn’t be taxes or rules in place that make sure that the consumers of lithium don’t internalize the cost.
In terms of total harm, even people working lithium mines are better off if that eliminates ICE engines.