[SMM Analysis] Zijin Mining H1 2026: Profit Surges 68%, LCE Production Exceeds 2025 Total

Zijin Mining released its 2026 semi-annual report. During the reporting period, the Company achieved total profit of RMB 63.5 billion, up 84% year-on-year; net profit of RMB 49.8 billion, up 74% YoY; net profit attributable to shareholders of RMB 39.2 billion, up 68% YoY; and net profit attributable to shareholders excluding non-recurring items of RMB 38.0 billion, up 76% YoY, of which Q2 achieved approximately RMB 19.6 billion, up 6% quarter-on-quarter. Net cash flow from operating activities reached RMB 55.5 billion, up 92% YoY, reflecting ample and stable cash flow. As of period-end, total assets stood at RMB 541.4 billion, net assets attributable to shareholders at RMB 205.9 billion, and the asset-liability ratio was 49.55%, falling below 50% for the first time since 2012, indicating further optimized asset structure.

Lithium Segment: "Third Growth Pole" Achieves Scale Contribution

During the reporting period, the Company's lithium segment has achieved scale contribution, with H1 lithium carbonate equivalent (LCE) production of 44,000 tonnes, a significant increase year-on-year, already surpassing the full-year 2025 level (25,500 tonnes). Among this, Q1 production was 16,000 tonnes, up nearly 11 times year-on-year; based on this, Q2 production was approximately 28,000 tonnes, up about 75% quarter-on-quarter, mainly driven by production ramp-up at the "Two Lakes and Two Mines" projects and the commissioning of the heavy-media beneficiation plant at the Manono lithium mine in the DRC at the end of May.

Against the backdrop of rising lithium prices, the lithium segment's profitability has been released simultaneously. The Company's average selling price of LCE in Q1 was about RMB 101,500/tonne, up 68% quarter-on-quarter from Q4 2025, and the segment's gross margin rose to approximately 61%. The Company stated that the lithium segment will become a new core growth engine for profits.

Progress of the "Two Lakes and Two Mines" Projects

Tibet Laguocuo Salt Lake Lithium Mine: Phase I (20,000 tpa lithium salt project) has been commissioned and put into operation; Phase II (50,000 tpa) is scheduled for completion by the end of 2027, which will bring total lithium salt capacity to 70,000 tpa upon full ramp‑up. The process uses brine extraction + adsorption + membrane coupling (titanium‑based adsorbent).

Argentina 3Q Salt Lake Lithium Mine: Phase I (20,000 tpa lithium carbonate project) was commissioned in September 2025; if the technical modification is approved, production could rise to 30,000 tpa after reaching full capacity. Construction of Phase II (40,000 tpa) is progressing in an orderly manner. The process uses the evaporation‑precipitation method.

Hunan Xiangyuan Hard Rock Lithium Polymetallic Mine: The 5 Mtpa mining‑beneficiation project and the supporting battery‑grade lithium carbonate smelter have been successfully commissioned, and will form a capacity of 30,000 tpa of battery‑grade lithium carbonate at full operation. The process uses open‑pit mining + gravity separation + magnetic separation + flotation.

DRC Manono Lithium Mine Northeast Project: It is a lithium‑rich LCT (lithium‑cesium‑tantalum) pegmatite deposit. The Phase I 5 Mtpa mining‑beneficiation project is advancing steadily; the heavy‑medium beneficiation plant was commissioned at the end of May 2026, and the smelting system is planned to be completed by the end of 2026. Upon full operation, it is expected to generate 130,000 tpa of LCE capacity, making it the largest single capacity increment among the four projects.

The four flagship projects together plan to produce about 110,000 tonnes of LCE in 2026. Combined with other lithium assets, the Company’s total LCE production target for the full year 2026 is 120,000 tonnes, representing a year‑on‑year increase of over 400%.

Medium‑term plan: 270,000–320,000 tonnes by 2028, positioning the Company as one of the world’s largest lithium producers.
According to the Company’s Three‑Year (2026‑2028) Major Mineral Product Output Plan and 2035 Vision released in February 2026, under the overall guideline of “improving quality, increasing output, controlling costs, and enhancing efficiency”:

• By 2028, LCE production is targeted at 270,000–320,000 tonnes, up 980%‑1,180% from 2025 levels (the Company ranked 10th globally in LCE production in 2025). In the same period, gold production is targeted at 130‑140 tonnes and copper at 1.50‑1.60 million tonnes, with copper and gold output entering the global top 3.

• By 2035, key indicators are expected to achieve leapfrog growth from 2025 levels, with some indicators reaching global No. 1, and the Company aims to become a “green, high‑tech, world‑class international mining group.”

Demand side: The Company forecasts that global lithium demand will exceed 3 million tonnes LCE by 2030, and the lithium industry is evolving from a “paper surplus” to a tight balance situation.

SMM Brief Comment:
Zijin’s “Two Lakes and Two Mines” have a clear production ramp‑up path for 2026‑2028. The 2026 growth mainly comes from the full‑capacity operation of the 3Q salt lake and Xiangyuan lithium mine, plus the commissioning and ramp‑up of the Manono beneficiation system. In 2027‑2028, further growth will be driven by Laguocuo Phase II (+50,000 tpa), 3Q technical modification and Phase II (+50,000 tpa), and full commissioning of the Manono smelting system (130,000 tpa LCE in the long term). In the current lithium price upcycle, Zijin is achieving both volume and price growth through its low‑cost combination of salt lake and hard rock assets. Its commissioning and ramp‑up progress will be a key variable in the global lithium supply balance. SMM will continue to track the commissioning progress of the Manono smelting project by the end of 2026 and the construction pace of Laguocuo Phase II and 3Q Phase II.

(Source: Zijin Mining announcements, compiled by SMM)