Chilean iodine and lithium producer SQM increased its
earnings by 53.6% year-on-year in 2017.
Higher lithium prices were at the core of SQM’s
strong overall performance, coupled with consistently strong
demand growth, chief executive officer Patricio de Solminihac
said during a conference call on the company’s
results earlier this month.
"We achieved the same sales volumes in our lithium and
derivatives business line in 2017 as in the previous year, but
prices increased by 25%, with an average price of more than
$13,500 per tonne in the fourth quarter [of 2017]," de
Average prices for lithium carbonate battery grade (min
99.5%) rose on February 28 to $18.50 per kg on a cif Asia
basis, and to $17.50 per kg on a cif United States/Europe
basis, compared with $7 per kg in March 2016, according to
Industrial Minerals’ market assessments.
The spot price of China-origin lithium carbonate (Li2CO3),
ex-works China, battery grade (min 99.5%), remained at 150,000
yuan ($23,669) per tonne, according to Industrial
Minerals’ assessment on March 1.
An agreement reached with Chilean economic development
agency Corfo will allow the company to increase production
without pumping more brine from the salars where it
"SQM will expand production capacity to 70,000 tonnes [per
year] of lithium carbonate in Chile this year, aiming to expand
again… to 100,000 tpy by 2019 by improving the
extraction rates of lithium from the salars," de Solminihac
said during the conference call.
SQM produced close to 49,700 tonnes of lithium and
derivatives in 2017.
De Solminihac said during the call that SQM would expand
production at the Salar de Atacama according to market
conditions, adding that the company is ready to service the
demand generated by the rapid growth of the battery sector.
SQM’s iodine business has benefited greatly
from the favorable market conditions and higher sales that have
increased its global market share to 35%.
Throughout 2017, the company sold 12,700 tonnes of iodine
and derivatives, 24.4% more than in 2016. It also started
iodine capacity expansion in Nueva Victoria in central Chile at
the end of 2017, in order to reach an effective iodine
production capacity of 11,000 tpy.
The completion of the Nueva Victoria expansion will give SQM
a total effective iodine production capacity of 14,000 tpy by
the second half of 2018.
SQM said that average iodine prices were close to $20 per kg
in 2017, down by 12.3% from 2016 but rebounding.