With winds rising and clouds soaring, which U.S.-listed lithium resource company stands out? A deep-dive analysis of SQM, LTHM, and LAC.

In our previous article, we analyzed Albemarle Corporation; in this edition, we turn our attention to Sociedad Química y Minera de Chile S.A. (SQM) and Lithium Americas Corp. (LAC). This article focuses specifically on the companies’ lithium and lithium-derived businesses. Sociedad Química y Minera de Chile S.A. (SQM) SQM is a global leader in the production and sale of fertilizers, lithium, iodine, and industrial chemicals. Compañía de Productos Químicos Especiales S.A., a subsidiary of SQM, produces specialty plant nutrients and chemicals. The diagram below illustrates SQM’s business scope; for details, please click to enlarge the image. First, let’s analyze its lithium resources: SQM’s products primarily originate from two sources in northern Chile: the Caliche nitrate deposit and the Salar de Atacama brine deposit. The Caliche deposit hosts the world’s largest reserves of iodine and nitrates, while the Salar de Atacama brine deposit is rich in lithium and potassium. SQM sells its products to over 100 countries worldwide through its global distribution network, with the majority of its revenue generated outside Chile. To expand its resource base and operations beyond Chile, in 2016 SQM entered into a 50/50 joint venture agreement with Lithium Americas to develop the Cauchari-Olaroz brine project in Jujuy Province, Argentina—targeting an annual production capacity of 50,000 tonnes of lithium carbonate equivalent. In 2017, SQM and its subsidiary SQM Australia Pty Ltd acquired a 50% stake in the Mount Holland lithium project in Western Australia, establishing a 50/50 joint venture with Kidman Resources Limited. The Mount Holland lithium project plans to commence mining and construct concentration and refining facilities starting in 2021, with an expected annual output of 40,000 tonnes of lithium carbonate and lithium hydroxide. Beyond lithium resources, let’s examine SQM’s equity structure and mineral rights: From an equity perspective, Tianqi Lithium Corporation of China holds 25.86% of SQM’s shares, making it SQM’s second-largest shareholder. SQM’s exploration rights, mining rights, and other mineral interests include: (1) Exploration and mining rights over the Caliche nitrate deposit in northern Chile; (2) Leased mining rights over the Salar de Atacama brine deposit in northern Chile, as well as adjacent mining and exploration rights surrounding the salt flat; (3) Mineral rights in the Cauchari-Olaroz brine project in Jujuy Province, Argentina, held via the 50/50 joint venture with Lithium Americas; (4) Mineral rights in the Mount Holland lithium project in Western Australia, held via the 50/50 joint venture with Kidman Resources Limited. Notably, the Caliche nitrate deposit lies within protected areas in Chile’s Tarapacá and Antofagasta regions and contains abundant resources of nitrates, iodine, and high-concentration potassium. The Salar de Atacama brine deposit is located within the Salar de Atacama desert east of the Puna de Atacama plateau and is rich in potassium, sulfates, lithium, and boron.

Major progress in Hong Kong’s largest IPO of the year: A Chinese lithium industry giant secured subscriptions from LG Chem and Zijin Mining—what are this company’s growth prospects?

Author / Mango Under the Stars Editor / Liang Watermelon Under the Stars Layout / Youmaicai Under the Stars On June 19, Tianqi Lithium Corporation (HKEX: 0978.HK) passed its listing hearing and updated its offering documents. It is reported that the company aims to raise USD 1.0–1.2 billion through this IPO—potentially making it Hong Kong’s largest IPO of the year. If financing proceeds smoothly, Tianqi Lithium’s debt burden incurred from its acquisition of SQM will ease significantly, alleviating its overall financial pressure. I. Love at First Sight—The Price of Falling for SQM Who is SQM? SQM stands for Sociedad Química y Minera de Chile S.A., Chile’s largest domestic chemical enterprise. Today’s global lithium market comprises three main categories: lithium concentrates; basic lithium salts—including lithium carbonate, lithium hydroxide, and lithium chloride; and inorganic and organic lithium derivatives. SQM primarily produces basic lithium salts—specifically lithium carbonate. In 2021, SQM possessed an annual lithium carbonate production capacity of 120,000 tonnes from brine sources—accounting for approximately 34% of global brine-based lithium carbonate capacity—and ranked as the world’s largest lithium carbonate producer. According to SQM’s 2021 Annual Report, its capacity is set to expand further in 2022, targeting 180,000 tonnes of lithium carbonate annually plus an additional 30,000 tonnes of lithium hydroxide. Moreover, SQM’s total lithium resource sales volume accounted for 19% of the global market—matching the market share of U.S.-based Albemarle Corporation (ALB)—making it one of the world’s largest lithium resource suppliers. SQM possesses extensive experience and advanced production technology in extracting lithium from brine, placing it at the forefront globally in terms of lithium extraction costs. According to Roskill, SQM’s lithium carbonate production cost is less than half that of Ganfeng Lithium (SZSE: 002460). SQM is truly the ‘beautiful, wealthy, and talented’ belle of the lithium industry. To win SQM’s favor, Tianqi Lithium pursued a two-step strategy: Step One: In 2016, Tianqi acquired a 2.1% stake in SQM’s Class B shares. Step Two: In 2018, Tianqi paid USD 4.066 billion (approximately RMB 25.893 billion at the time) to acquire a 23.77% stake in SQM’s Class A shares. Through these two rounds of investment, Tianqi paid roughly USD 4.275 billion in total. Yet, Tianqi has still not fully won SQM’s hand. According to Tianqi Lithium’s current prospectus: Tianqi Lithium does not receive lithium supply from SQM. Moreover, as part of its acquisition of SQM, Tianqi committed that: (i) any director it nominates to SQM’s board must not concurrently serve as a director, executive officer, or employee of Tianqi Lithium; (ii) such nominated directors may not assume managerial roles at SQM; and (iii) Tianqi must refrain from proactively seeking commercially sensitive information from SQM. Consequently, Tianqi lacks effective control over SQM. In short, Tianqi’s pursuit of SQM remains at the stage of “gifting money and luxury cars”—a genuine partnership remains uncertain. Persistent debt-related pressures continue to weigh heavily on Tianqi. Compared with its peer Ganfeng Lithium, Tianqi operates with significantly higher leverage. Excluding the impact of industry-wide factors in 2021 and focusing solely on pre-2020 data, Tianqi’s leverage ratio was nearly double that of Ganfeng Lithium. This high leverage imposes substantial interest-payment burdens. According to its annual reports, Tianqi’s interest expenses on individual loans alone have approached RMB 2 billion in recent years. Meanwhile, its operating cash flow has been contracting. Cash generated from operations is sometimes insufficient even to cover interest payments. Adding to this, ongoing capital injections into its Australian projects continue to deplete the company’s cash reserves—its cash position is deteriorating steadily.

Point Nemo Capital Purchases 18,177 Shares of Sociedad Quimica y Minera S.A.

6 days ago

Point Nemo Capital LLC initiated a new position in SQM, purchasing 18,177 shares valued at approximately $1.18 million during the third quarter. The investment follows SQM's strong quarterly earnings that beat analyst estimates.

MarketBeat

2026-03-31

SQM Proposes 50% 2025 Earnings Payout, Stock Rises 7.3%

2026-04-13

Sociedad Quimica y Minera de Chile Stock Hits 52-Week High

2026-04-15

SQM (NYSE: SQM) files updated technical report summaries on Chile properties

2026-04-15

SQM Files Salar de Atacama Technical Report Summary and Consents

2026-04-17

Sociedad Quimica y Minera Shares Fall 7.2% Amid Analyst Concerns