Lithium price: Chile giant’s scorched earth strategy – by Frik Els ( – August 17, 2018)

SQM this week sold its 50%-share in an Argentinian brine joint venture, leaving the world’s number two producer of lithium with a single project outside its core Chilean operations.

The $12.8 billion Santiago based company can afford to let assets go – its pipeline is choc full already.

Production startup for the 40,000 tonnes per year Mt Holland project alongside Kidman Resources in Western Australia is 2020. The spodumene mine will begin producing lithium carbonate and hydroxide a year later.

In May SQM announced that for a relatively modest investment of $525m, capacity in the Atacama salt flats will be lifted from 48,000 tonnes to 180,000 tonnes within three years. Roughly $75m (less than the proceeds of the Argentine transaction) is being spent at Salar de Carmen this year to lift capacity to 70,000 tonnes.

That’s a headline cost of just $4,000 for each additional lithium carbonate equivalent tonne. The ruling price for South American lithium carbonate exports is $15,000 per tonne.

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