{"id":1134101,"date":"2019-08-22T07:46:55","date_gmt":"2019-08-22T12:46:55","guid":{"rendered":"https:\/\/www.mining.com\/?p=1000023"},"modified":"2019-08-22T07:46:55","modified_gmt":"2019-08-22T12:46:55","slug":"worlds-no-2-lithium-miner-sqm-hit-by-weak-prices","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1134101","title":{"rendered":"World\u2019s No. 2 lithium miner SQM hit by weak prices"},"content":{"rendered":"<p>Chile\u2019s Chemical and Mining Society (SQM), the world\u2019s<br \/>\nsecond largest lithium producer,&nbsp;has been hit by sustained weak prices for<br \/>\nthe metal used in batteries that power electric vehicles (EVs) and high tech electronics,<br \/>\nwith profits falling by 47.5% to $70.2 million in the second quarter, from<br \/>\n$133.9 million a year earlier.<\/p>\n<div class='d-flex justify-content-center'>\n<div id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {googletag.display('div-gpt-ad-1561499308230-0');});<\/script><\/div>\n<\/div>\n<p>Delivering&nbsp;<a rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\" href=\"http:\/\/s1.q4cdn.com\/793210788\/files\/doc_news_spanish\/2019\/August\/PR_2Q19_esp_final.pdf\" >results for the three months to June 30<\/a>, the Santiago-based company echoed analysts and other market players\u2019 concern about the effect that oversupply of the battery metal as well as cuts to EVs subsidies is having on prices.<\/p>\n<p>&nbsp;\u201cThe second quarter<br \/>\nresults were mainly impacted by lower lithium sale prices,\u201d Chief Executive<br \/>\nRicardo Ramos said in a statement. \u201cWe have seen lithium supply growing more<br \/>\nthan demand over the past few quarters, putting pressure on prices.\u201d<\/p>\n<p>The miner attributed the sharp decline in its selling prices<br \/>\nto higher sales to China, the world\u2019s top consumer of the commodity, where<br \/>\nprices have sunk.<\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p>Quarterly earnings fell by almost half, even as sales volumes grew.<\/p>\n<\/blockquote>\n<\/figure>\n<p>Prices for lithium carbonate, the most common type used in EV batteries, doubled over 2016 and 2017. Since then, they have fallen by more than 40% over the past year, to around $9.25 per kg at the end of July, commodity research group <a href=\"https:\/\/www.mining.com\/lithium-prices-to-remain-low-as-hype-has-met-reality-cru\/\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">CRU said on Wednesday<\/a>.<\/p>\n<p>The consultancy says that lithium prices will continue to be<br \/>\ngoverned by cost fundamentals, which will keep them in the single-figures.<\/p>\n<p>CRU\u2019s view seems to be backed by the main producers. Earlier this month, Albemarle Corp (NYSE: ALB), the world\u2019s No. 1 lithium miner,&nbsp;<a href=\"https:\/\/www.mining.com\/albemarle-puts-the-break-on-growing-plans-amid-lithium-market-weakness\/\"  rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">postponed plans to add about 125,000 tonnes<\/a>&nbsp;of processing capacity&nbsp;due to oversupply.<\/p>\n<p>The company has also revised a&nbsp;<a href=\"https:\/\/www.mining.com\/mineral-resources-signs-1-15b-lithium-deal-albemarle\/\"  rel=\"noreferrer noopener\">deal to buy into Australia\u2019s Mineral Resources<\/a>\u2019 (ASX: MIN) Wodgina<br \/>\nlithium mine and said it would delay building 75,000 tonnes of processing<br \/>\ncapacity at Kemerton, also in Australia.<\/p>\n<p>Despite market weakness, SQM said it expected sales volumes to increase in the near-term, noting that shipments to China had already jumped. \u201cWe sold higher sales volumes in the second quarter and expect to sell higher volumes in the second half of the year as we prepare for a 30% to 40% increase in sales volumes next year,\u201d Ramos said. <\/p>\n<p>SQM still expects sales volumes for the year to reach between<br \/>\n45,000 and 50,000 tonnes and said the figure will grow further thanks to a key project<br \/>\nin the Middle East, which will require 400,000 tonnes of lithium between 2020<br \/>\nand 2022.<\/p>\n<p>The company did not provide details on such project.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Quarterly earnings fell by almost half, even as sales volumes grew.<\/p>\n","protected":false},"author":8,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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