The global boom in electric vehicle production has sent demand for lithium-ion batteries soaring. That’s turned Chile’s vast, lithium-containing salt flats into a vital national resource. In Chile’s Salar de Atacama, near the border with Argentina and Bolivia, close to one-third of the world’s lithium is produced from brines.
But South America’s fifth most-populous country is losing market share on the world stage to Australia, which in 2017 leapfrogged Chile to become the largest producer of lithium. Argentina is also gaining momentum thanks to increased international investment.
With increasing pressure to ramp up production, Chile’s leftist president Gabriel Boric recently announced a state-led plan for the development of the country’s lithium industry. The policy, disclosed in April, requires private companies to partner with the government for the development of all future lithium mines.
The only two lithium companies currently operating in Chile are North Carolina-based Albemarle, the largest lithium producer in the world, and SQM, the No. 2 producer, headquartered in the Chilean capital of Santiago. Both companies’ stock prices slumped after the new policy was presented amid concern the government will be exerting too much control over future projects.
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