SQM Records Lower Income Despite Higher Sales in Q3

---

Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Sociedad Quimica y Minera (Santiago, Chile), known as SQM, registered a drop of 73% in its net income due to the collapse in global lithium prices.

SQM recorded a net income of US$131 million during the third quarter, about 73% less than during the same period last year and 38% lower compared to Q2. However, in the first nine months of this year, the company has registered a loss of US$524.5 million, compared to a net income of US$1.8 billion in 2023.

The third-quarter results emerge following the collapse of lithium prices despite higher sales. Between July and September, SQM's lithium sale volumes increased by 18%, though prices were 67% lower.

The sales of iodine, specialty plant nutrition and potassium were also 9%, 22% and 4% higher year on year, respectively. Only the company's industrial chemicals segment had a drop in sales of 74%.

Lithium and iodine represented the largest gross profit contribution this year, with 42% and 40%, respectively.

"We are publishing our third-quarter 2024 financial results with positive volume growth in almost all of our business lines compared to last year. Fertilizer markets have shown solid market dynamics with a market size recovery. Our Specialty Plant Nutrition volumes grew more than 20% year-on-year while our revenues in this business line increased close to 12%," said Chief Executive Officer Ricardo Ramos.

The collapse in lithium prices follows an oversupply of the market and a slower-than-expected growth in the demand for electric vehicles. However, the long-term growth of lithium remains positive, given the transition to cleaner technologies worldwide.

The company expects the excess capacity of lithium and battery materials experienced during 2023 to persist throughout 2024.

For this year, SQM projects lithium sales volumes between 190,000 metric tons (MT) and 195,000 MT. Also, the company foresees a total installed lithium carbonate equivalent capacity of 305,000 MT by the end of next year, across its operations in Chile, Australia and China.

SQM's capital expenditures for this and next year have been set at US$1.7 billion, with about US$70 million per year destined for maintenance. The company continues with its capacity expansion of 240,000 MT of lithium carbonate and 100,000 MT of lithium hydroxide in Chile.

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 over 200,000 current and future projects worth $17.8 trillion (USD).