Australia’s largest pure-play lithium producer, Pilbara Minerals Ltd., has reported a net loss of A$69 million ($44 million) for the six months ending December 31, despite seeing signs of recovery in lithium demand. The company attributed the loss to a significant drop in lithium carbonate prices, which have fallen by approximately 87% from their 2022 peak, and are down more than 22% from the same period last year. Pilbara Minerals’ shares remained largely unchanged at A$2.01 following the announcement.
CEO Dale Henderson expressed optimism about a potential rebound in both prices and demand, driven in part by the restart of a major mine and refinery in China by Contemporary Amperex Technology Co. Ltd. (CATL), the world’s largest producer of electric vehicle batteries. Henderson indicated that the restart of CATL’s operations could signal a shift in the market.
“The restart of that particular mine is a positive development,” Henderson told in an interview. “After 18 months of declining prices, we’re starting to see the effects of these curtailments. This cycle, like others in the commodities market, indicates tightening supply chains and the necessity for price recovery.”
Henderson noted that the resumption of CATL’s project is likely to stimulate a rebound in lithium prices, positioning Pilbara Minerals to benefit from the upcoming market rally. Pilbara Minerals, which operates the Pilgangoora mine in northern Australia, has ramped up its lithium production, but was forced to temporarily shut down one of its processing plants due to shrinking margins caused by low prices.
In addition to increasing sales from its existing operations, Pilbara Minerals has expanded its portfolio by acquiring Latin Resources Ltd., a company holding undeveloped lithium mines in Brazil. While the company currently focuses on spodumene, a key lithium mineral, Henderson has not ruled out diversifying into lithium brine in the future.
“It’s certainly on the cards,” he said. “If we were to pursue this, it would likely be on a small scale, given that it’s not our core expertise.”
Despite the financial setback, Pilbara Minerals remains cautiously optimistic about the long-term prospects of the lithium market as demand for electric vehicles and battery storage continues to grow globally.
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