Recently, U.S. Treasury Secretary Janet Yellen visited Chile and expressed the policy shift of the U.S. regarding critical raw materials needed for the electric vehicle industry. Yellen announced that lithium salt imports from Chile are expected to increase, utilizing the country's abundant lithium reserves to strengthen U.S. supply chains and reduce reliance on China.
The U.S. government's attitude of seeking cooperation with Chile on lithium imports signals its strategic direction of diversifying the sources of raw materials for its own lithium battery industry. This move is also part of the Biden administration's plan to strengthen ties with key free trade partners like Chile. At the same time, Chile has the world's largest lithium reserves and is expected to play a critical role in the U.S.'s green energy agenda. Such cooperation serves the interests of both countries in promoting sustainable energy development and reducing carbon footprints. This partnership may set a precedent for future trade relations, emphasizing the importance of energy sustainability and carbon reduction.
In addition, the Chilean government plans to bring three to four new lithium extraction projects into operation before 2026. Judging from the expectations in the earnings report of SQM, Chile's second largest lithium producer, the company's lithium salt output from domestic salt lakes in Chile will be 220,000-230,000 tons in 2024. The company's current strategy is full production, and according to the agreement with Codelco, sales volume will increase significantly after 2025, preparing to supply more products to the market.
