Two of China's largest lithium miners have become the latest miners to issue a stern warning about the health of the battery metals industry, warning investors to be prepared for a sharp decline in profits and asset write-downs.
While optimism about the EV outlook remains, the downturn in the battery materials market has upended battery programs around the world with oversupply. With iron ore in a straight line, miners are cutting production and looking to control costs.
Core Lithium halts mining in 'tough' market conditions.
China's Tianqi Lithium CorpFull-year profit is expected to fall by as much as 73 percent from a year earlier, and will now be in the market at 6.6 billion yuan (9.6 billion), it said TuesdayUS$200 million) to $8.9 billion.
Tianqi Lithium said profits have been hit by lithium *** and expects its investment income in Chile's SQM to decline as well. The company is also preparing to imcredit some of its assets.
Its rival, Ganfeng Lithium Group, also expects a sharp decline in profits, with full-year profits falling by 70 to 80 percent.
Ultra-light metals used in EV batteries have had their bumpy years in recent years. The Lithium Price Index has risen by more than 80% from record levels in early 2023, with markets being hit by fears of shortages and warnings of a massive surplus in the near term.