Chile roundup: SQM hit by low lithium prices, Codelco-Rio Tinto eye new copper ops

SQM presses on with Chilean expansion despite falling lithium prices

In the first nine months of the year, Chilean lithium producer SQM saw its revenues drop 43.9% year-on-year, reaching US$3.46bn due to the decline in prices of the soft, white metal.

Lithium prices in the third quarter averaged 24% lower than the previous quarter and are expected to continue sliding in a market that is temporarily oversupplied, the company, the world’s second-largest lithium producer, said in a statement.

However, the firm's sales volumes rose 18% year-on-year during the three months ending September 30, reaching 51,200t, driven mainly by demand from China's electric vehicle (EV) market, although sales were down 2.1% compared with 2Q24.

The electromobility industry accounts for over 70% of current lithium demand, a figure expected to exceed 80% by the end of this decade. Meanwhile, EV adoption in global economies is projected to rise from 20% to 50% by 2030, SQM executives said during an analyst conference on Wednesday.

For this reason, SQM will continue expanding its operations in the Atacama salt flat in northern Chile and its facilities abroad.

The company estimates that its total lithium carbonate equivalent (LCE) production capacity will reach 305,000t/y by the end of 2025, up from this year’s total output of 210,000t. Of this total, 180,000t will come from its chemical plant in Chile’s Antofagasta region, executives said during the conference.

While SQM expects to sell 195,000t of lithium this year, annual profits will be affected by the price decline. In the third quarter, the company’s Ebitda plummeted 57% year-on-year to US$339mn.

Codelco-Rio Tinto partnership seeks to begin copper exploration

Through their joint venture,  Nuevo Cobre, Anglo-Australian multinational Rio Tinto and Chilean state-owned miner Codelco aim to develop the Dionisio mining exploration project with an investment of US$37mn.

The objective is to reduce geological uncertainty regarding potential copper deposits in a mountainous area located 3,800m above sea level in Chañaral province, Atacama region, with the overarching aim of assessing the feasibility of a new copper mine in the area.

To achieve this, the project involves a drilling program of 365 boreholes across 199 platforms, with average depths of 500m. The program is expected to last 31 months.

The environmental impact statement for Nuevo Cobre – 57.7% owned by Rio Tinto and 42.3% by Codelco – was accepted for review this week by environmental review service SEA.