SQM earmarks US$2.1bn for investments by 2023

The strategy of Chilean non-metallic miner and lithium producer SQM for the next five years will remain focused on access to unique natural resources and low cost operations.

During a breakfast meeting with investors in New York, CEO Ricardo Ramos presented the company's long-term strategy to face the complexities of the lithium value chain.

By 2025, growth opportunities in the lithium business could result in close to a US$1bn contribution to gross profits, he said. SQM hopes to sell 65,000t/y of lithium carbonate by 2020 and 150,000t/y by 2025. Investments include US$280mn to expand lithium carbonate production to 50,000t/y and US$100mn to boost lithium hydroxide output to 16,000t/y.

The company’s total capex for 2019-23 is expected to be US$2.1bn. 

According to the company’s forecasts, of the global capacity of 960,000t of lithium carbonate by 2025, 41% will come from brines and 59% from hard rock. Chile's contribution of 235,000t will come 100% from brines, while Argentina's 82,000t will all come from rock.

During the meeting, Pablo Altimiras, SQM's VP for the lithium and iodine business, said that in the coming years there will be enough demand to ensure the company's growth. To guarantee growth the company will invest US$1.3bn by 2023.

Ramos said the company forecasts lithium prices will be between US$10,000/t and US$15,000/t by 2025.

He also said the company is open to M&A opportunities and to starting geological work to search for metallic deposits.

"Although lithium is very important for the future of SQM ... SQM is much more than lithium," he said.

Picture credit: SQM