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Lithium miner’s profit more than triples on EV battery demand

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Chile’s SQM, the world’s second-largest lithium producer, more than tripled its fourth-quarter net profit on Thursday from the same period last year, beating expectations of a surge in demand and a white metal supply shortage.

Competition for lithium, which SQM extracts from brine from the vast salt flats of South America, has seen prices skyrocket in recent years. car Manufacturers are looking to produce more electric vehicles (EVs) to comply with stricter climate regulations.

SQM posted a net profit of $1.15 billion for the three months ended December 31, 2022, slightly above the average analyst estimate of $1.14 billion surveyed by Refinitiv.

Revenue in the quarter also nearly tripled to $3.13 billion, beating the average estimate of $2.99 ​​billion and boosting core earnings to $1.67 billion.

Lee representativecar“I am pleased with the extraordinary result,” said de Ramos.

The company said earnings were boosted by record sales of lithium and its derivatives, which SQM ships primarily to Asia. Some of this year’s expected sales have been brought forward ahead of the expected end of China’s EV subsidies, the company said.

SQM’s fourth quarter lithium sales increased 38% year over year to 43,000 tonnes, hitting a record average volume of $59,000 per tonne. A year ago, lithium was selling for just $14,600 per ton.

In a separate statement, SQM said it will invest about $3.4 billion from 2023 to 2025 and focus on expanding Chile’s lithium production capacity. The roadmap includes his $1.2 billion investment due this year.

SQM said it expects lithium capacity to rise to 265,000 tonnes in 2025 from a forecast of 210,000 tonnes this year as plants in southwestern Australia and China’s Sichuan province come online.

SQM also sells iodine and expects volumes and prices to rise this year as the price of chemicals used in X-rays also hit a record in the fourth quarter and as it works to expand production capacity. increase.

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