Chile´s SQM boosts lithium sales even as profits plunge, promises further expansion by 2023

SANTIAGO, Nov 19 (Reuters) - Chilean miner SQM said it continued to boost sales of lithium even as low prices battered profits, prompting the world’s No. 2 producer of the electric vehicle battery metal to announce a further expansion by 2023.

SQM said it had sold 17,700 tonnes of lithium in the third quarter, up 56% from the same period the previous year.

The company said in a statement announcing its quarterly results that it would likely sell 30% more lithium in 2020 than in 2019, and promised a similar jump in sales in 2021.

Lithium miners boosted output last year in anticipation of a demand rush from carmakers going into 2020, but the COVID-19 pandemic slammed the brakes on the electric vehicle revolution, denting profits and forcing many companies to shelve expansion plans.

SQM´s net income plunged 97% year-on-year to $1.7 million in the quarter, dragged down by low prices and a one-time, $62.5 million settlement fee in a class action lawsuit.

Nonetheless, the company said its current plans to boost its production of lithium carbonate and lithium hydroxide - two of its key products - by the second half of 2021 remained on track.

Strong sales and a recovery in China had underpinned a decision to ramp up production capacity even further, to 180,000 and 30,000 metric tonnes of lithium carbonate and lithium hydroxide, respectively, by 2023, the company said.

“All of this, again, with lower brine extraction,” said CEO Ricardo Ramos in a statement late on Wednesday.

The miner, long under scrutiny for its environmental practices, in October announced plans to slash its use of both fresh water and lithium-rich brine at the Atacama salt flat, part of a broader sustainability drive.

The company said it will spend $1.3 billion on a range of Chile projects between 2021 and 2024.

Reporting by Dave Sherwood; Editing by Kim Coghill