According to the earnings release of AMG Critical Materials N.V. on 1 August, AMG Lithium sold 17,092 dry metric tons (dmt) of spodumene concentrates, a slight increase from 15,652 dmt in the previous quarter. The company achieves an average realized sales price of US$891/dmt CIF China and an average cost of US$543/dmt CIF China, both down from US$1,163/dmt and US$616/dmt in Q1 2024. The gross profit further decreases from US$5.3 million at 12.9% in Q1 2024 to US$3.8 million at 9.9%.
The company is ramping up its lithium concentrate plant in Brazil, expecting to reach an annual capacity of 130,000 tons by Q4 2024, which will exert minor improvements in unit costs, according to Eric Jackson, the COO.
AMG has also invested US$20 million in Savannah Resources, securing a 15.77% stake in Europe’s largest spodumene lithium deposit in Portugal. The company is also progressing with its lithium hydroxide refinery in Germany, set to produce 20,000 tons annually, expected to start shipping in Q3 2024.
AMG management still expresses a cautiously optimistic view on the future lithium market. CEO Heinz Schimmelbusch highlights that current lithium prices are below the cash costs for many producers, especially Chinese lepidolite producers, suggesting that this situation is unsustainable and likely to correct itself. He also notes that despite some pessimistic forecasts, global demand for lithium remains stable, which should support future price improvements.
Author: Hongqiu Su | Battery Metals Analyst Associate | London Office, Shanghai Metals Market
Email: lilysu@smm.cn
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