Ningde Times’ Back-up Plan

On one hand, numerous automakers have launched their own battery ventures to achieve self-sufficiency—refusing to outsource the largest cost component of vehicle production to suppliers like CATL. On the other hand, beyond CATL, automakers now have BYD’s Blade Battery as a compelling new alternative. Once the market shifted away from pure oligopolistic competition, players naturally adjusted across multiple dimensions—including pricing. For instance, CATL introduced new pricing agreements with its automotive partners: part of the battery procurement would be priced based on a lithium carbonate benchmark of 200,000 RMB/ton, while the remainder would follow prevailing market prices—at that time, domestic battery-grade lithium carbonate was quoted at 480,000 RMB/ton. However, acceptance of this concessionary agreement came with conditions: automakers must commit to sourcing no less than 80% of their battery requirements from CATL over three years and make advance payments for a certain proportion of orders. Back in the days when He Xiaopeng personally camped out at CATL’s factories to secure battery supplies, automakers would have eagerly signed such contracts en masse. But today’s conditions, environment, and landscape have all changed. The ‘Prince Ning’ is no longer the undisputed sovereign of the power battery domain. Multiple automakers have established in-house battery companies, and other battery firms have also secured substantial OEM partnerships. Although CATL still has no shortage of collaborators, its recent aggressive moves have stirred up a hornet’s nest—making it, for a time, an entity that partners and capital markets alike sought to avoid. How to break this impasse has thus become CATL’s most urgent priority. 2. Seeking Opportunities Abroad The first development—‘chilling upon reflection’—is CATL’s plan to acquire a lithium mine in Brazil. The Brazilian lithium project, named Grota do Cirilo, is indeed highly attractive: it is the largest and highest-grade spodumene deposit in the Americas, with total resources estimated at approximately 3.032 million tons LCE (1.45% Li₂O). According to schedule, the Grota do Cirilo spodumene project commenced trial operations in December 2022. Phase I is expected to produce 270,000 tons annually of high-purity, battery-grade lithium concentrate—equivalent to roughly 36,700 tons LCE per year. Moreover, based on updated mineral reserve studies, Sigma Lithium stated that the project holds potential to produce 768,000 tons of lithium concentrate (104,000 tons LCE) annually during Years 2 through 8 of operation. Sigma Lithium—a company engaged in lithium mining in the Jequitinhonha Valley of Minas Gerais State, Brazil—owns and operates the Grota do Cirilo project as its flagship asset. On December 18, 2023, Sigma announced that negotiations regarding the sale of its business had entered the final stage. The transaction was originally expected to close before year-end, but the Board now anticipates completion in 2024. According to an investigation by Exame IN, two consortia are currently in the final stages of acquiring the business. CATL—the Chinese battery giant—and Volkswagen—the German automaker—are viewed as the most likely buyers. It is reported that Tesla had attempted to engage with the company, but those talks did not progress. Currently, Sigma Lithium trades on the Canadian Securities Exchange at a valuation slightly exceeding USD 3 billion; due to falling lithium prices, its share price has declined 15% year-to-date.

Rising Lithium Prices: Industry Leader’s Quarterly Profit Surges Nearly 17-Fold—Opportunity Knocking!

If we further examine lithium-mining companies’ stock performance since the market resumed its upward trend on April 8, 2025, by May 15, 19 companies had doubled their share prices over the past year-plus. Among them, Tianhua New Energy, Da Zhong Mining, Shengxin Lithium Energy, and Guocheng Mining posted gains of 458.07%, 448.88%, 343.23%, and 282.25%, respectively. First-quarter earnings of lithium-mining enterprises improved significantly From the perspective of price transmission mechanisms, this round of price increases has already moved beyond futures-market sentiment-driven momentum and begun translating into upstream companies’ financial results. According to Wind data, among the 23 constituent stocks in the lithium-mining sector, 20 achieved profitability in Q1 2025—compared to only 16 in the same period of 2025. In terms of year-on-year improvement, 18 companies posted stronger Q1 2025 results than in Q1 2024. Among lithium-mining firms, industry leaders Tianqi Lithium (002466.SZ) and Ganfeng Lithium (002460.SZ) delivered notable profit growth. Specifically, Tianqi Lithium recorded RMB 1.876 billion in net attributable profit for Q1 2025, representing a 1,699.12% year-on-year increase; Ganfeng Lithium turned from loss to profit, achieving RMB 1.837 billion in net attributable profit. Additionally, Salt Lake Potash, Western Mining, Zangge Mining, and Tianhua New Energy reported Q1 net attributable profits of RMB 3.027 billion, RMB 1.586 billion, RMB 1.574 billion, and RMB 0.969 billion, respectively—up 154.78%, 96.34%, 110.60%, and 1,471.98% year-on-year. Tianqi Lithium posted the strongest earnings growth among the 23 lithium-mining companies in Q1 2025. Per its quarterly report, in Q1 2026, the company achieved revenue of RMB 5.128 billion, up 98.44% year-on-year and 73.89% quarter-on-quarter; net attributable profit reached RMB 1.876 billion, up 1,699.12% year-on-year and 563.54% quarter-on-quarter; non-recurring net profit stood at RMB 1.816 billion, surging 3,987.18% year-on-year and 530.73% quarter-on-quarter. Tianqi Lithium’s robust year-on-year and quarter-on-quarter earnings growth in Q1 2026 stems from rising lithium carbonate and lithium concentrate prices. According to Wind data, the average domestic lithium carbonate price in Q1 2026 was RMB 154,000/ton—up 74.8% quarter-on-quarter. Per IGO’s announcement, the average Greenbush lithium concentrate price in Q1 2026 was USD 1,668/ton—up 96% quarter-on-quarter. “Lithium prices have bottomed out and reversed course; the simultaneous rise in volume and price in Q1 2026 drove explosive earnings growth.” In its latest research report, China Post Securities noted that lithium product prices declined 21.03% year-on-year in 2025, dragging down revenue—but with Wenfeilide’s lithium mine pricing cycle shortening, the timing mismatch between Talison’s chemical-grade lithium concentrate pricing mechanism and the company’s lithium chemical products’ sales pricing mechanism—which previously impaired profitability—has been substantially mitigated. As inventory concentrate costs gradually align with the latest procurement prices, profitability has markedly recovered. Considering the upward lithium price trend and sustained output ramp-up from the company’s Greenbush lithium mine and its equity stake in SQM’s salt-lake operations, the firm is projected to achieve net attributable profits of RMB 7.583 billion, RMB 8.577 billion, and RMB 9.140 billion in 2026, 2027, and 2028, respectively—representing year-on-year growth of 1,539.07%, 13.11%, and 6.57%. Corresponding EPS estimates are RMB 4.44/share, RMB 5.03/share, and RMB 5.36/share.

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Sigma Lithium reported strong Q2 FY2026 results with record lithium oxide concentrate production of 35,400 tons and $55 million in net revenues. The company outlined plans to expand installed capacity to 830,000 tons by 2028 while maintaining low cash costs.

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Sigma Lithium Reports Record Q2 FY2026 Earnings and Production Growth

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