Lithium Recovery Sends SQM Earnings to Highest in Two Years
(Bloomberg) --
Lithium producer SQM delivered the highest quarterly earnings in two years on record sales volume, while signaling the global battery-metal market is emerging from a prolonged glut. Its shares surged.
SQM, the world’s biggest supplier of lithium from brine deposits, reported $404 million in third-quarter earnings before interest, taxes, depreciation and amortization, slightly ahead of the average analyst estimate and the highest since the same quarter of 2023.
The Chilean firm is benefiting from a price recovery in recent months driven by a strong demand outlook for electric vehicles and large-scale battery storage, after years of oversupply. On a call with analysts Wednesday, management said global lithium demand is set to grow 25% this year to more than 1.5 million metric tons — up from a previous call of 17% growth — and beyond 1.7 million tons next year.
“Supported by strong lithium demand, we expect the upward price trend to continue through the fourth quarter of 2025,” the company said.
SQM shares were up 5.7% to a two-year high at 10:57 a.m. in New York.
The lithium market is shifting its focus back to demand after news coverage in the past few months was dominated by the suspension of a mine run by the world’s biggest EV battery maker, Contemporary Amperex Technology Co. Supply-side anxiety is being overshadowed by excitement over demand for large-scale battery storage. To be sure, while spot lithium prices are about 50% above a June low, they’re still about 85% below a 2022 peak.
One of SQM’s biggest rivals, Albemarle Corp., said earlier this month that global EV sales rose 30% and lithium-ion battery demand for stationary storage jumped 105% year-on-year in the nine months through September. On Sunday, Ganfeng Lithium Group Co. Chairman Li Liangbin was quoted as saying that demand is expected to grow 30% next year.
“Easier comparisons, higher average realized prices and increased sales volumes should support a better close to 2025” for SQM, Bloomberg Intelligence analyst Sean Gilmartin wrote last week.
(Adds 2026 demand forecast in third paragraph; shares in fifth)
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