Total Losses May Reach 10 Billion Yuan! How Will the "Lithium Mine Duo" Break Through in 2025?

In 2024, due to the continuous decline in lithium prices, the profitability of lithium mining companies significantly decreased, with the "two lithium mining giants" both experiencing substantial declines in performance. Tianqi Lithium turned from profit to loss. On the evening of March 26, Tianqi Lithium (002466.SZ, 9696.HK) released its 2024 annual report. In 2024, the company achieved a total operating revenue of 13.063 billion yuan, down 67.75% YoY, and a net loss attributable to shareholders of the listed company of 7.905 billion yuan, down 208.32% YoY. Tianqi Lithium stated that although the production and sales of lithium compounds and derivatives achieved YoY growth in 2024, affected by the fluctuations in the lithium product market, the market prices of lithium products showed a significant downward trend throughout the year, leading to a substantial decrease in the selling prices and gross profit of the company's lithium products compared to the same period last year. At the same time, due to the time cycle mismatch between the pricing mechanism of the chemical-grade lithium concentrate of the company's subsidiary Talison and the sales pricing mechanism of the company's lithium chemical products, the company experienced phased losses in its operating performance during the year. In 2024, the market price of chemical-grade lithium concentrate gradually decreased, and the price of newly purchased lithium concentrate from Talison also declined. As the newly purchased low-priced lithium concentrate was gradually put into storage and the inventory of lithium concentrate was gradually consumed, the cost of chemical-grade lithium concentrate used in the production costs of the company's various bases gradually approached the latest purchase price, and the phased mismatch in the pricing mechanism of lithium concentrate also gradually weakened. Data shows that Tianqi Lithium is committed to the long-term development strategy of "consolidating the upstream, strengthening the midstream, and penetrating the downstream." The company's main products include lithium concentrate products (including chemical-grade lithium concentrate and technical-grade lithium concentrate) and lithium chemical products (including lithium carbonate, lithium hydroxide, lithium metal, lithium chloride, etc.), which are widely used in end-use markets such as electric vehicles, three types of electronic products, new-type energy storage, drones, glass, and ceramics. In terms of upstream lithium resources, Tianqi Lithium currently controls the Greenbushes spodumene mine in Australia. As of December 31, 2024, the total mineral resources of the project were 440 million mt, with an average lithium oxide grade of 1.5%, equivalent to approximately 16 million mt of LCE; the total reserves of the Greenbushes spodumene mine increased to 172 million mt, with an average lithium oxide grade of 1.9%, equivalent to approximately 8.1 million mt of LCE. Greenbushes currently has four lithium concentrate beneficiation plants, with a built lithium concentrate capacity of 1.62 million mt/year, and the mining area is constructing the chemical-grade No. 3 plant, which will increase the annual capacity of the Greenbushes lithium concentrate project to approximately 2.14 million mt/year upon completion. At the same time, Tianqi Lithium currently holds a stake in SQM, which owns the Atacama salt lake project in Chile. Located in the "Lithium Triangle" region of South America, this project is one of the few salt lake projects in the world with high lithium ion concentration, large reserves, and a low lithium-magnesium ratio. According to Project Blue data from January 2025, the Atacama salt lake owned by SQM ranked second in global lithium resource project production in 2024, second only to the Greenbushes spodumene project, with the total production of the Atacama salt lake owned by SQM accounting for 16.9% of the total global lithium resource production. As of now, the company holds a total of approximately 22.16% of SQM's equity. In terms of midstream lithium processing, Tianqi Lithium currently has five lithium chemical product production sites, located in Shehong, Sichuan; Suining Anju, Sichuan; Tongliang, Chongqing; Zhangjiagang, Jiangsu; and Kwinana, Australia (Phase I battery-grade lithium hydroxide project), with a built lithium chemical product capacity of approximately 91,600 mt/year. Among them, the Shehong production site in Sichuan is the company's earliest production site, with a rich variety of products and mature operation management, with a comprehensive lithium chemical product annual capacity of approximately 24,000 mt, including 14,500 mt/year of lithium carbonate capacity, 5,000 mt/year of lithium hydroxide capacity, and 4,500 mt/year of lithium chloride capacity. The Zhangjiagang production site in Jiangsu currently has 20,000 mt/year of battery-grade lithium carbonate capacity. According to a Wood Mackenzie industry report, the Zhangjiagang production site is the world's first fully automated battery-grade lithium carbonate factory in mature operation. The Tongliang production site in Chongqing currently has 600 mt/year of lithium metal capacity, which is of great significance to the company's layout in the solid-state battery field. The Suining Anju factory in Sichuan currently has 23,000 mt/year of battery-grade lithium carbonate capacity. The project produced its first bag of battery-grade lithium carbonate products at the end of 2023 and completed its capacity ramp-up in mid-2024, currently operating at full capacity. The Kwinana factory in Australia (Phase I battery-grade lithium hydroxide project) currently has 24,000 mt/year of battery-grade lithium hydroxide capacity. This project is Australia's first in-production lithium hydroxide project and the first overseas lithium hydroxide production line operated by a Chinese enterprise. In October 2024, the project completed a large-scale technological transformation and is currently in the ramp-up stage. In addition to the existing lithium chemical product production sites, Tianqi Lithium is accelerating the construction of the 30,000 mt lithium hydroxide project at the Zhangjiagang production site in Jiangsu (which can flexibly adjust to produce lithium carbonate products) and the 1,000 mt lithium metal and supporting raw material project in Chongqing. In terms of the upstream and downstream of the industry chain, in addition to laying out salt lake lithium resources through equity stakes in SQM and Zhabuye in Shigatse, Tianqi Lithium is also actively laying out new energy materials, power batteries, solid-state batteries, and new energy vehicles in the new energy industry chain, establishing various forms of strategic cooperation with upstream and downstream top-tier enterprises in the new energy industry chain such as Aerospace Power, SES, Beijing Weilan, XTC New Energy Materials (Xiamen), Sichuan Energy Investment, CALB, and smart. In the 2025 work plan, Tianqi Lithium stated that the company will closely follow the development strategy of "consolidating the upstream, strengthening the midstream, and penetrating the downstream." First, it will actively and orderly advance the related work of the Yajiang Cuola spodumene mining and beneficiation project, further strengthen the company's resource security capabilities, and enhance the stability of the company's production raw material supply chain (especially the domestic supply of raw materials for lithium chemical product production). At the same time, it will maintain an open and cooperative attitude to continue to pay attention to high-quality lithium resource projects globally, continuously consolidate the company's leading position in lithium resources, and provide more guarantees for the company's long-term stable resource self-sufficiency capabilities. Second, it will steadily implement the increase in production and expansion of lithium products, orderly advance the construction of Talison's chemical-grade No. 3 plant, and continue to promote the capacity ramp-up of the Kwinana factory's Phase I battery-grade lithium hydroxide project, the 30,000 mt lithium hydroxide project at the Zhangjiagang production site in Jiangsu (which can flexibly adjust to produce lithium carbonate products), and the progress of the 1,000 mt lithium metal and supporting raw material project in Chongqing, develop and expand the company's lithium concentrate and lithium chemical product processing business, consolidate the company's leading position in global lithium product production, and further leverage the synergistic effects of the industry chain; fully utilize and enhance the technical advantages and experience of automated production, continuously improve resource utilization, and continue to lead the global level of automated production in lithium salt factories. Third, it will pay high attention to opportunities in the upstream and downstream of the industry chain, continuously optimize the company's investment portfolio, improve the layout of the industry chain, and provide new value growth points for the company's long-term sustainable development. Fourth, it will continue to expand the company's global business layout, expand the global customer base, and strive to continuously improve customer stickiness and market share. In terms of scientific research, in 2025, Tianqi Lithium will accelerate the pace of technological R&D from four research directions: comprehensive utilization of mineral resources, new-type lithium extraction technology, next-generation battery new materials, and battery recycling, and explore new business directions. In the direction of comprehensive utilization of mineral resources, the company will build a demonstration line for the recovery of tantalum and niobium concentrates; complete the development of new-type beneficiation reagents, and assist mining projects in completing the upgrade and optimization of processes and equipment. In the direction of new-type lithium extraction technology, the company will conduct verification of the engineering capabilities of the adsorption + membrane integrated lithium extraction process and the electrochemical intercalation lithium extraction technology. In the direction of next-generation battery new materials, the company will complete the quality and capacity upgrade of lithium sulfide, advance the construction of production lines; achieve the debugging and optimization of lithium metal anode materials and equipment, conduct product sampling and application, and obtain process packages for small varieties of lithium salts such as lithium iodide and lithium oxide. In the direction of battery recycling, the company will complete the feasibility study report and strengthen technical reserves. Ganfeng Lithium's first annual loss. Battery Network noted that affected by the fluctuations in the lithium product market, Tianqi Lithium turned from profit to loss in 2024, and another lithium mining giant, Ganfeng Lithium, also faced a cold winter, with its first annual loss in performance. Ganfeng Lithium expects a net loss of 1.4 billion to 2.1 billion yuan in 2024, down 128.3% to 142.45% YoY. Regarding the reasons for the performance change, Ganfeng Lithium stated that it was mainly due to the impact of the fluctuations in the lithium product market, with the selling prices of lithium salts and lithium battery products falling. Although product shipments increased YoY, the company's operating performance significantly decreased YoY. Recently, during an interactive exchange with investors, Ganfeng Lithium stated that the company currently has a total equity resource of approximately 40 to 50 million mt of LCE, which can basically meet the company's development and utilization needs in the coming years. Regarding the short-term outlook and judgment on lithium prices, Ganfeng Lithium analyzed that the company believes the current lithium price is likely in a relatively bottom area, mainly based on: recent lithium prices have felt strong cost-side support, industry inventory is at a historically relatively low level, and recent demand has shown significant improvement. Whether lithium prices can rise in the future depends on whether there is a significant exit on the supply side and whether there is a possibility of sustained demand exceeding expectations. It is worth mentioning that as the decline in lithium prices severely impacted performance, Ganfeng Lithium plans to extend to the downstream energy storage sector of the industry chain. On February 21, Ganfeng Lithium announced that the company intends to acquire all the equity of its subsidiary Yichu Energy held by its subsidiary Ganfeng LiEnergy for 200 million yuan. After the completion of this transaction, Yichu Energy will change from an indirectly controlled subsidiary of Ganfeng Lithium to a directly controlled subsidiary. It is reported that in January this year, Yushe County, Jinzhong City, Shanxi Province, and Yichu Energy held a signing ceremony for an energy storage project, with a total investment of 1.6 billion yuan and a land area of approximately 130 mu. The project will be invested and constructed by Yichu Energy in the Yushe Economic Development Zone, mainly including the construction of energy storage systems, booster station systems, comprehensive office systems, and auxiliary production systems. On March 24, the 400MW/800MWh grid-side independent shared energy storage power station project invested by Yichu Energy in Datong Xinrong, Shanxi Province, started construction. The official launch of the Datong Xinrong energy storage power station project marks an important milestone in the implementation of the new energy strategy of Yichu Energy, a subsidiary of the Ganfeng Group.