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Mineral Resources Achieves Annual Production Targets, Emphasizes Cautious Expansion

On July 26, 2024, Australian lithium producer Mineral Resources reported the production and sales performance of its three major lithium projects—Mt Marion, Bald Hill, and Wodgina—during the second quarter of 2024.

Mt Marion produced 89,000 tons of spodumene concentrate last quarter and shipped 67,000 tons. The SC6 spodumene concentrate price was $1,178 per ton. Compared to the previous fiscal year, total production increased by 40%, reaching a record 328,000 tons, with SC6 shipments up 46% to 218,000 tons, meeting the guidance target of 190,000-220,000 tons. FY2024 FOB SC6 costs are expected to be AUD 750 per ton.

Bald Hill, which began production at the end of 2023, saw a quarter-on-quarter increase in spodumene concentrate production of 19% to 35,000 tons last quarter. Shipments increased by 23% quarter-on-quarter to 27,000 tons of SC6. The annual average price was $1,198 per ton.

Wodgina’s spodumene concentrate production increased by 28% quarter-on-quarter to 63,000 tons. Despite a brief downtime in June due to a crusher belt failure, high-grade feed and improved processing efficiency boosted production. The achieved SC6 price was $1,243 per ton. FY2024 FOB SC6 costs are expected to be $974 per ton. Lithium battery chemical production in FY2024 totaled 18,385 tons, up 60% year-on-year, with sales of 23,995 tons.

During a conference call, Mineral Resources emphasized its cautious strategy for expanding lithium production under current market conditions, as the current price does not support increased supply. Despite record production and shipments at Wodgina and Mt Marion, the company is cautious about adding new supply by activating Wodgina’s third production line. Investor Relations Manager Chris Chong stated, “We don’t want to increase market supply without real benefits.”

The company emphasized that cost management remains a priority, including plans to increase recovery rates at Wodgina and optimize strategic plans for existing assets. The company will continue to explore new deposits around its assets as part of its regional integration strategy. Production guidance for FY2025 and further strategic details will be disclosed in the full-year report in late August.

Greenbushes Lithium Mine Operator IGO Reports FY2024 Results and FY2025 Guidance

On July 30, IGO, the world’s largest hard rock lithium producer, held its FY2024 fourth-quarter earnings call, highlighting its efforts and achievements in the lithium business and overall market.

CEO Ivan Vella reported that the Greenbushes lithium mine achieved full production, with quarterly spodumene concentrate production up 19% quarter-on-quarter to 332,000 tons. Spodumene sales reached 530,000 tons, significantly higher than the previous quarter’s 183,000 tons. The quarterly average realized price for spodumene was $1,020 per ton (FOB Australia). Production cash costs were AUD 338 per ton, down 12% from the previous quarter, with full-year FY2024 cash costs at AUD 330 per ton.

Regarding FY2025 guidance, IGO expects annual production to be between 1.35 million and 1.55 million tons, with cash costs ranging from AUD 320 to AUD 380 per ton, similar to FY2024’s actual and guidance levels. However, the upper limit of expected production may increase. Vella noted, “There are certainly opportunities for growth.” He also acknowledged that “recovery rates are still not meeting expectations.” The company will focus on optimizing existing operations to maximize output before investing in new capital expenditures.

Construction of the Greenbushes CGP3 project is underway. CGP3 will have an annual processing capacity of 2.4 million tons, producing up to 500,000 tons of concentrate per year, with production expected to begin in early FY2026. Vella acknowledged that overall cost inflation in Western Australia and initial project challenges may impact progress and costs.

Performance at the Kwinana Refinery improved, with lithium hydroxide production up 39% quarter-on-quarter to 1,331 tons. However, IGO continues to address and improve performance levels, with plans for a short-term shutdown in FY2025 for critical upgrades.

During the call, management acknowledged the current uncertainty in the lithium market, particularly the fluctuations in downstream demand in China and Europe and the United States, while reiterating confidence in Greenbushes’ cost and profit performance.

Umicore and BASF Pause Recycling Investments to Adapt to Slowing EV Market Growth

In their FY2024 fourth-quarter earnings calls on July 26, Umicore and BASF announced strategic adjustments in response to challenges in the battery materials market.

Umicore CEO Bart Sap noted that growth in customer contract volumes would be delayed by 18 months, with expected sales significantly reduced. Umicore will launch a strategic review to reassess growth expectations for its battery materials business post-2024, including stricter capital allocation to cope with changing market conditions and keep up with regional policy shifts.

Due to a slowdown in EV sales and delayed inflows of expected scrapped batteries, Umicore will delay its investment in a large-scale battery recycling plant in Europe until 2032. The company will focus in the near term on optimizing its existing pilot recycling plant in Hoboken, Belgium.

Sap stated, “Apart from our CAM assets in China, our global capacity utilization will be strong.” The company faces a €1.6 billion impairment related to battery materials, mainly concentrated in Asia. However, management did not disclose specific capacity idle levels or the extent of the impact on the company.

BASF’s current CEO and former head of BASF Greater China, Markus Kamieth, said, “In China, we see some downward pressure on electric vehicles in Q4, with high inventory levels leading to less robust performance than usual.” Meanwhile, BASF plans to pause its large-scale battery materials recycling smelting project in Tarragona, Spain, until Europe’s battery capacity construction and electric vehicle installation speed regain momentum.

[Source- 上海有色网] 【海外锂周度要闻一览】Mineral Resources锂辉石产量达全年预期 https://news.smm.cn/news/102884295

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