Will the Involvement of Australian Miners in Lithium Processing Impact the Downstream Market?

Canberra: Overall, the Lithium market is observing record-breaking profits for enterprises having a substantial foothold in Lithium processing. The recent Q3 earning results of Albermarle, one of the significant Lithium producers, soared by seven times on a year-on-year basis. At the same time, the SQM earing replicated by 10.5 times compared to the same period last year. Such exceptional netbacks over investments seek the attention of several Australian miners to extend into the Lithium processing business.

On Monday (November 28), Australian miners ‘Pilbara’, known for its periodic Lithium mine auctions, announced signing a Joint Venture (JV) agreement with Calix, an Australian technology company. The two parties will jointly develop a Lithium processing pilot plant using Calix’s patented forging technology, indicating a clear intention to participate in the midstream Lithium processing link to support the production of highly pure Lithium Carbonate and Lithium Hydroxide. The processed product is a chemical substance with a low degree of refinement and easier production of Lithium Carbonate and Lithium Hydroxide, mainly used in Lithium Iron Phosphate and several tertiary Lithium Cathode materials. Initially, it is likely to be an intermediate product between

As per industry experts, such midstream projects have the potential to change the current dynamics in the industry. Pilbara CEO Dale Henderson added that the company would provide superior intermediate products accompanied by reduced carbon footprints while having higher Lithium Concentration in essential salts like Lithium Carbonate and Lithium Hydroxide with fewer impurities than conventional routes.

As per the ChemAnalyst pricing intelligence, the cooperation project to develop an intermediate had three significant advantages. First and foremost, the retention rate of Lithium Oxide will increase while reducing the product unit cost. Secondly, reduce carbon footprints and use 100% renewable energy through electrification, and third reduce waste and processing costs. In addition, it also has the potential to disrupt the benchmark market away from China, as currently, the Lithium market is heavily dominated by Chinese market participants amid better infrastructure and first mover advantage.