The lithium battery sector is experiencing a cyclical turnaround—only by selecting the right investment targets can one truly profit.

Anode materials: Currently dominated by natural graphite and artificial graphite; the next generation centers on silicon-based materials, with leading manufacturers including BTR, Putailai, Shanshan Co., Ltd., and Hitachi Chemical. Separators: Divided into dry-process base films, wet-process base films, and coated separators. Domestic leaders include Enjie Co., Ltd., Shenzhen Senior Technology Material Co., Ltd., Jinli New Energy, and Sinoma Science & Technology. Electrolytes: Include conventional organic electrolytes, while also advancing next-generation solid-state electrolytes. Tianqi Materials, Shenzhen Capchem Technology Co., Ltd., and Guotai HuaRong hold dominant positions domestically. Batteries fall into three major categories: power batteries, energy storage batteries, and battery recycling. Power batteries are used in new-energy vehicles, with mainstream technologies being ternary (NCM/NCA) and lithium iron phosphate (LFP); emerging technologies include sodium-ion and solid-state batteries. Leading players include Contemporary Amperex Technology Co., Limited (CATL), BYD, LG Energy Solution, CALB, Eve Energy, and NARDA Power Source. Additionally, as the first wave of new-energy vehicle batteries reaches end-of-life, lithium battery recycling has grown increasingly critical. GEM specializes in resource recovery from retired batteries and is the industry leader. 3. Performance of sector leaders Reviewing recently disclosed annual reports and earnings forecasts across the entire industrial chain reveals clear signs of industry-wide recovery—but performance disparities among segments and firms are stark. Some companies have surged ahead, while others remain mired in difficulty: some report profits exceeding RMB 10 billion with over 100% YoY growth, while others post losses exceeding 100%. Lithium and cobalt resources: In 2025, lithium carbonate staged a dramatic V-shaped rebound—prices bottomed at RMB 58,000 per ton in June, then surged to RMB 120,000 per ton by year-end. Amid this roller-coaster price action, mining companies’ financial results diverged sharply. Tianqi Lithium and Ganfeng Lithium were once dubbed the 'twin lithium kings.' In 2025, Tianqi Lithium achieved rebirth following its painful restructuring, reporting a net profit of RMB 460 million—a 107% YoY increase. The long-standing issue of 'pricing mechanism mismatch'—which had severely constrained Tianqi—was finally resolved, enabling the company to fully capture upside from rising lithium prices. Combined with surging investment returns from SQM and foreign exchange gains from the strengthening Australian dollar, Tianqi turned profitable. Ganfeng Lithium likewise returned to profitability, posting a net profit of RMB 1.6 billion, up 178% YoY. Yet closer inspection reveals its non-recurring net profit was actually a loss of RMB 385 million. Where did the profit come from? The answer lies in capital market activities. As clearly stated in its announcement, Ganfeng recorded approximately RMB 1.03 billion in fair-value gains from its equity stake in Pilbara Minerals—meaning its return to profitability was driven primarily by financial instruments. Others fared even worse: Shengxin Lithium reported an annual loss of RMB 888 million. Nevertheless, with lithium prices surging significantly, research institutions have substantially upgraded their earnings forecasts for the company. Midstream lithium materials: The midstream segment endured the fiercest price wars between 2022 and 2024—and consequently underwent the most thorough industry consolidation, unexpectedly emerging as the segment with the strongest reversal momentum in the lithium battery sector. Cathode materials determine both energy density and cost, representing the largest cost component in lithium batteries. Under broader industry recovery, performance diverged between the ternary and LFP cathode routes. The top two LFP cathode material leaders both posted strong turnarounds: Hunan Yunneng forecasted YoY growth of 93.75%–135.87%; Longpan Technology’s net profit rose 72.86%, yet it still reported a loss of RMB 173 million.

The second half of Tianqi Lithium’s 'Chile controversy' may harbor hidden opportunities.

Beyond Tianqi Lithium and local Chilean stakeholders, numerous Chilean lawmakers also attempted to block the transaction. According to a local news report recently compiled by the Economic and Commercial Office of the Chinese Embassy in Chile, Tapia—a pro-Democratic Alliance independent member of the Chamber of Deputies representing the Atacama Region—filed a criminal complaint against SQM and CODELCO at the Central-North Prosecutor’s Office, accusing them of administrative misconduct, rent-seeking, and dereliction of duty. Tapia contends that SQM and CODELCO’s 2025–2060 cooperation agreement was concluded without public tender and involved opaque negotiations. Under this agreement, SQM extended its lithium mining contract to 2060 without payment—conferring undue benefit upon itself and potentially causing economic losses to Chile. Moreover, according to Chilean media outlet El Ciudadano, the Chilean Chamber of Deputies held its 55th special session on July 23 to vote on a proposal calling for the annulment of the agreement. The motion passed with 41 votes in favor, 15 against, and 10 abstentions. Although this vote does not directly nullify the SQM-CODELCO Joint Venture Agreement, it may exert substantial pressure on its future implementation—and introduce uncertainty regarding the smooth establishment of the joint venture between Codelco and SQM. Notably, because Pampa Group—the largest shareholder of SQM—maintains close ties with the Pinochet family of Chile’s former military regime, both industry and political circles widely view the partnership as detrimental to national interests—not only technically and economically, but also politically and ethically. Consequently, this vote has been dubbed by the media a 'citizen victory'—defending commercial fairness and transparency, and rejecting secret deals with corrupt politicians. From 'buying' mines to 'safeguarding' mines: the optimal business solution driven by commercial interests Whether the original acquisition of SQM shares or the current response to the SQM-CODELCO transaction, although both processes are highly complex, the underlying corporate logic remains straightforward: maximizing commercial returns. SQM is a veteran global supplier of agrochemical fertilizers and lithium products. It ranks first worldwide in production of sodium nitrate and potassium nitrate for industrial and agricultural use—and is the world’s largest iodine producer. SQM also possesses mature expertise in producing lithium carbonate and lithium hydroxide, ranking among the world’s leading lithium product suppliers and investors. The Salar de Atacama in Chile—developed by SQM—is endowed with high lithium concentration, vast reserves, favorable extraction conditions, and low operating costs—making it one of the world’s most advantageous salt-lake lithium resources and a globally significant lithium production hub. SQM demonstrates stable, reliable profitability and generous dividend payouts: its cash dividend payout ratio reached 100% in both 2016 and 2017. 'The Company, based on its long-term bullish outlook on the new-energy industry, SQM’s superior resource endowment, its stable profitability and dividend capacity, and the strategic synergy between Tianqi’s technological strengths and SQM’s resource advantages, acquired a 23.77% equity stake in SQM in 2018,' Tianqi Lithium stated. The simpler the operational logic, the more effective the outcome. Tianqi Lithium’s decision to acquire SQM shares has delivered substantial returns over the past several years.

Albemarle vs. SQM: Investment Analysis of Leading Lithium Producers

Jun 29, 2026

This article compares Albemarle and SQM, two major lithium producers, analyzing financial performance and growth prospects amidst rising EV demand. It concludes Albemarle offers a better opportunity due to stronger earnings growth and lower leverage.

The Globe and Mail

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