Forecast: Chile's Lithium Output to Rise 1.5% This Year Despite Price Drop

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Chilean mining regulator Cochilco issued its lithium market report, noting the country is projected to produce 275,000 tons of lithium carbonate equivalent (LCE) this year, an increase of 1.5% compared to 2023 volumes. For 2025, Chile is expected to produce 285,000 tons of LCE.

The increase in production comes despite a global decrease in lithium prices, which have declined from almost $70,000 a ton in 2022 to roughly $12,000 per ton amid lower demand, according to Cochilco. Based on a June consensus projection, the LCE price is expected to average $16,450 per ton (CIF Asia) in 2025.

The lower LCE prices are the outcome of lower-than-expected sales of electric vehicles, lower inventories from lithium companies, and new production coming online with the startup of projects.

For this and next year, Cochilco foresees a global oversupply of 117,000 tons of LCE and 191,000 tons of LCE, respectively.

The overall global demand of LCE for this and next year has been set at 1.129 million tons of LCE and 1.404 million tons of LCE, respectively, according to Cochilco. Lithium batteries will continue to dominate LCE demand in 2025, requiring 89% of production.

From January to May this year, Chile had accumulated US$1.59 billion from lithium exports, about 65% less than during the same period last year, due to the decline in lithium prices.

In addition, the global lithium price has triggered a slowdown in project expansions, pushing companies to reduce operating costs to protect their margins.

On the exploration front, up until 2023, the United States received 26.7% of all the investments destined for the discovery of lithium reserves, followed by Canada (20.9%), Australia (20.3%), Asia (15.5%), Africa (8.8%), Latin America (7.6%), and the rest of the world (0.3%).

Industrial Info is tracking 21 active lithium brine extraction mine projects in Chile, worth US$6.26 billion. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a list of detailed project reports.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 Trillion (USD).