Market recovery signal? Lithium industry giant Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B (SQM.US): Global demand expected to increase by 25% this year.

One of the world's largest lithium producers, Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B (SQM.US), has stated that global demand for this battery metal is expected to increase by about 25% this year as the industry gradually emerges from global supply glut. The company's latest quarterly sales figures, which reached a historic high, seem to confirm this view. The enterprise, which operates with the world's richest lithium salt lake brine resources, reported that sales in the fourth quarter of last year rose to over 66,000 tons, an increase of over 50% compared to the same period the previous year. The company stated that the growth in lithium demand will be mainly driven by electric vehicles and energy storage systems. This is the first financial report released by Sociedad Quimica y Minera de Chile S.A. Sponsored ADR Pfd Series B since introducing the Chilean state-owned copper giant Codelco as a partner in the Atacama project. The two parties plan to increase the output of this large comprehensive project by about 30% in the coming years. The Atacama project uses evaporation extraction technology, which consumes less water, chemicals, and energy compared to the hard rock mining method commonly used in the largest lithium-producing country globally, Australia. The joint venture NovAndino is preparing to submit a proposal to regulatory agencies to introduce new technologies, including direct extraction, which is expected to further increase production. NovAndino is trying to capitalize on the opportunity of double-digit growth in global lithium consumption - the increase in large-scale battery storage demand and electric vehicle demand driving market expansion. As the industry gradually moves away from a phase of long-term oversupply and price pressure, this expansion may put pressure on higher-cost competitors. On the other hand, the temporary suspension of lithium concentrate exports in the main lithium-producing country, Zimbabwe, has raised concerns in the market that global supply of this battery metal may tighten, potentially supporting the lithium price. However, it should be noted that although the spot price of lithium has more than doubled since its low point in June last year, it is still more than 70% lower than its peak in 2022. According to the Ministry of Mines in Zimbabwe, the country has completely banned the export of lithium concentrate as of this Wednesday. Minister of Mines Polite Kambamura stated that this move aims to promote the development of the local processing industry and combat illegal ore export activities. He emphasized that the ban will remain in effect until the mining enterprises fully comply with government regulations. According to the U.S. Geological Survey, this African country contributed about 10% of the world's lithium ore production last year. Cameron Hughes, an analyst at the commodity consultancy CRU Group, pointed out, "The continued rise in lithium prices and rampant illegal export activities may be key factors driving this policy adjustment."