Chile’s SQM, the world’s second-largest lithium producer, on Wednesday posted an 82% fall in its fourth-quarter web revenue from a 12 months earlier, under forecasts as costs for the important thing battery steel continued to slip from earlier peaks.
The miner, which additionally produces fertilizers and industrial chemical substances, reported a quarterly web revenue of USD 205.9 million, under the USD 317 million anticipated by analysts polled by LSEG, after a gradual slide in earnings over 2023.
Income for the interval fell 58% to USD 1.31 billion, additionally lagging LSEG’s USD 1.35 billion forecast.
SQM mentioned it offered record-high volumes of lithium through the quarter, hitting round 51,000 metric tons and up almost 20% from a 12 months earlier, at the same time as common costs dropped 73%.
The corporate mentioned it anticipated lithium gross sales volumes to extend 5%-10% this 12 months, with world demand forecast to rise 20%, though warned that oversupply would maintain costs regular.
“The surplus in lithium and battery supplies … is predicted to proceed throughout this 12 months, protecting strain on lithium market costs,” SQM Chief Government Ricardo Ramos mentioned in a press release.
International provides for the electrical automobile battery steel outpaced demand over 2023, fuelling a glut that has dragged on costs and prompted producers akin to Albemarle, the world’s largest provider, to chop jobs and pause expansions.
SQM mentioned it anticipated to provide 210,000 tons of lithium carbonate within the first quarter this 12 months because it ramps up its Chile operations, including that 2024 capital expenditure would come to about USD 1.3 billion.
The group’s share value has slid round 30% within the final 12 months.
SQM additionally mentioned it’s working with communities in Chile’s Atacama area because it finalizes particulars of its settlement with state-run miner Codelco, signed in December, as a part of a authorities plan to spice up the state’s position within the lithium sector.
The deal triggered protests by native indigenous teams who blocked roads to SQM, inflicting a pause in operations.
