Tianqi Lithium: The Cards of the Global Lithium King Are Now Being Played

Greenbushes Mine in Western Australia, the Atacama Salt Flat in Chile, and lithium chemical plants in Zhangjiagang (Jiangsu) and Shehong (Sichuan)—these geographic coordinates outline Tianqi Lithium’s global footprint. It does not manufacture batteries or electric vehicles; it operates exclusively at the industry’s upstream—mining and processing the so-called “white petroleum.” Globally, one out of every five tons of spodumene concentrate originates from Tianqi’s Greenbushes Mine; moreover, Tianqi holds approximately 22% equity in SQM—the world’s largest lithium brine producer. Tianqi is the only Chinese lithium company possessing both top-tier hard-rock lithium mines and premier brine resources worldwide. On July 14, 2026, Tianqi Lithium stunned the entire lithium battery sector with a profit forecast: expected net profit attributable to shareholders for H1 2026 stood between RMB 2.85 billion and RMB 4.25 billion—a staggering year-on-year increase of 3,276% to 4,935%; non-recurring net profit was projected between RMB 2.81 billion and RMB 4.2 billion, surging over 310,000% year-on-year. Quarterly figures show Q1 net profit already reached RMB 1.876 billion; Q2 is forecast at RMB 0.974–2.374 billion. Thus, H1 net profit alone already exceeds Tianqi’s full-year 2025 net profit (RMB 0.458 billion) by six- to nine-fold. As of early August 2026, battery-grade lithium carbonate prices had rebounded to around RMB 141,000 per ton, while lithium spodumene concentrate prices hovered near USD 2,060 per ton—up more than 70% from the 2025 low of RMB 80,000 per ton. Industry capacity rationalization is taking effect, and Tianqi’s low-cost advantage positions it as one of the biggest beneficiaries of this lithium price rebound. I. Why Is the Profit Forecast Range So Wide? The RMB 1.4 billion spread—from RMB 2.85 billion to RMB 4.25 billion—stems primarily from one factor: SQM, a veritable “black box.” Tianqi’s profits consist of two major components: profits from Greenbushes spodumene concentrate (relatively predictable) and investment income from its equity stake in SQM (highly unpredictable). SQM poses three key challenges: (1) Timing lag—SQM releases its financial reports after Tianqi issues its earnings preview, forcing Tianqi to estimate blindly; (2) Reliance on external forecasts—Tianqi bases its estimate on Bloomberg’s projected SQM Q2 EPS, itself a range-based forecast; (3) High volatility in SQM’s own results—lithium prices averaged ~USD 18/kg in Q1, and both volume and price are highly likely to rise further in Q2. Tianqi knows SQM earned substantially—but not precisely how much. This RMB 1.4 billion gap reflects almost entirely the “blind-box” uncertainty surrounding SQM’s Q2 performance. Given Q1’s realized RMB 1.876 billion profit and the reality of rising volumes and prices in Q2, the most reasonable narrow-range estimate for H1 net profit attributable to shareholders is approximately RMB 3.5–4.1 billion, with a central estimate of ~RMB 3.8 billion. II. Comprehensive Financial Snapshot In 2025, Tianqi Lithium achieved total revenue of RMB 10.35 billion and net profit attributable to shareholders of RMB 0.458 billion—achieving profitability despite lithium prices plunging to the RMB 80,000/ton nadir. Its spodumene business remained robust, selling 810,000 tons at an average price of USD 821/ton, delivering a gross margin of 53%—far exceeding market expectations and underscoring Greenbushes’ status as one of the world’s lowest-cost hard-rock lithium mines. In 2026, performance exploded. Q1 net profit attributable to shareholders reached RMB 1.876 billion, up 1,699% year-on-year; gross margin climbed to 62.66%, and net margin soared to 55.4%.

After Continued Adjustments, What Lies Ahead for SQM and Lithium Mining?

Commodity prices—led by crude oil—fell sharply last week and have since continued adjusting downward. This triggered share price declines among prominent fertilizer companies including Sociedad Química y Minera de Chile (SQM), Yuntianhua, and Asia Potash International. So, is SQM still worth holding? Will SQM peak alongside commodities, as some external speculation suggests? This article presents forward-looking views based on potassium fertilizer’s revenue contribution and growth profile. 1. Potassium fertilizer accounts for less than 10% of SQM’s revenue—and poses no threat to its core operations. SQM’s recent sustained correction stems from weakening international commodity prices. Per its latest Q1 financial report, SQM’s potassium fertilizer revenue was USD 114 million, against total revenue of USD 2,019 million (see below). Thus, potassium fertilizer contributed just 5.6% of total revenue. 2. Potassium fertilizer’s share of SQM’s revenue will continue declining. Its growth rate stands at only 89%, dwarfed by lithium’s explosive 970% growth. At this pace, potassium fertilizer’s share of SQM’s total revenue will fall below 5% as early as Q2 2022. Hence, the current sell-off reflects largely blind, indiscriminate capital flows—investors fixating solely on the potential decline of a mere 5% business segment, while overlooking the explosive growth of lithium—the segment representing roughly 80% of SQM’s total revenue. 3. The Future of Lithium Resources First, a brief primer: Lithium resources fall into two main categories. One is spodumene ore, which is concentrated via mineral processing into ~6% Li₂O spodumene concentrate; this concentrate is then further processed into battery-grade lithium chemicals—such as battery-grade lithium carbonate or lithium hydroxide—used in cathodes and electrolytes for lithium-ion batteries. The other is lithium-rich brine, where lithium is extracted via natural evaporation or adsorption/separation technologies, then refined directly into lithium carbonate or lithium chloride; lithium carbonate may undergo further purification or causticization to yield battery-grade lithium salts. Lithium chemicals serve multiple applications: power lithium-ion batteries, consumer electronics batteries, energy storage batteries, power tool batteries, and industrial uses such as ceramics and chemical synthesis. Currently, power batteries account for over 70% of demand. Lithium demand surged in 2022—driven primarily by new-energy vehicles (NEVs); energy storage demand is excluded here. Canalys data shows that global EV sales reached 6.5 million units in 2021, up 109% year-on-year, representing 9% of total passenger vehicle sales. China accounted for half—3.2 million units (domestic official figures vary slightly: 3.521 million, 3.396 million, or 3.313 million—of which the latter, per China Passenger Car Association, appears most reliable). Projections indicate global EV sales will reach ~10.4 million units in 2022, capturing 12.5% of the total passenger vehicle market.

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