Albemarle makes hydroxide-to-carbonate switch

US lithium miner and processor Albemarle has shifted some its conversion capacity at its Qinzhou plant in Guangxi, China away from producing lithium hydroxide to making lithium carbonate instead, reflecting a stronger market for the latter.

The firm is not looking to moving away from hydroxide entirely, achieving record production of the material at its Meishan plant in China. And, in Australia, performance at the Kemerton hydroxide facility “continues to improve”, according to Albemarle CEO Kent Masters, with the site recently commencing its first battery-grade commercial sales.

But it has also decided to place another Chinese hydroxide plant, at Chengdu, into care and maintenance “due to market conditions and shifting product mix”, a process that it will complete by mid-year. “Chengdu is a relatively small plant with a capacity to produce c.5,000t of lithium hydroxide annually,” Masters says.

“We will continue to service those customers through the ramp of newer, larger plants in Chile, China and Australia,” he continues, arguing that this approach will allow Albemarle to best serve its customers “while driving network efficiencies and better leveraging our scale”.

At Qinzhou, the project to shift c.10,000t/yr of processing capacity to carbonate is “highly capital-efficient”, involving low single-digit millions of dollars in investment, and a “response to strong market demand”. While appetite for hydroxide is still growing, “carbonate is growing faster, so there is a stronger demand for carbonate”.

“It gives us more flexibility in the market,” Masters expands. “The market is stronger around carbonate now, so we can take advantage of that. Over time, we can shift this back either way.

“Once we make this investment, we could go back to hydroxide, if we wanted to, or stay on carbonate. At the moment, it makes more sense to be on carbonate,” he concludes.

There is also tolling capacity available in China if Albemarle wants to further increase its ability to process carbonate — “we have taken advantage of that in the past,” Masters reminds — but it has other options owing to growth at its Salar mine and La Negra conversion plant, which is also seeing record carbonate production, in Chile.