LG Energy Solution nearly doubles lithium order from SQM
South Korean battery cell manufacturer LG Energy Solution (LGES) is significantly increasing its order from Chilean lithium producer SQM (Sociedad Química and Minera de Chile). In fact, it nearly doubled the amount of battery-grade lithium carbonate and lithium hydroxide agreed upon in a previous contract.
In 2021, the two companies signed a contract for 55,000 tonnes by 2029. The new agreement now signed is for over 100,000 tonnes of battery-grade lithium carbonate and lithium hydroxide by 2029.
“We are grateful for the confidence placed by LGES in SQM’s capacity to supply refined lithium products for their electric vehicle cells,” says Carlos Diaz, Executive VP of Lithium at SQM.
That makes LGES by far the Chilean company’s most important customer. A status it briefly lost when another South Korean battery cell manufacturer – SK On – signed a lithium supply contract with SQM for up to 57,000 tonnes over five years last year. According to SK On, it is enough to produce batteries for about 1.2 million EVs.
Besides having been a reliable partner to LGES, lithium products from Chile are of great importance to carmakers. Because of trade agreements, EVs using battery cells with lithium from the South American country can qualify for tax credits in the US under the US Inflation Reduction Act. Subsidies will only be granted if, among other things, a certain percentage of critical battery materials are extracted or processed in the US or countries with a free trade agreement with the US.
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