Allkem's Mt Cattlin operation.
Allkem achieved record production from its Mt Cattlin lithium operation in WA in the 2021–22 financial year (FY22), as the company continues to find its post-merger rhythm.
Mt Cattlin produced 193,563 dry metric tonnes (dmt) of spodumene concentrate in FY22 and generated record revenue of $US188.9 million ($273.7 million) in the June quarter off the back of a gross cash margin of 84 per cent.
Allkem achieved a realised price of $US4992 ($7234)/dmt CIF (cost, insurance and freight) for a 5.4 per cent spodumene product in the June quarter, highlighting the world’s insatiable demand for spodumene concentrate.
To put this into perspective, Allkem sold spodumene at an average of $US1186 per tonne from August 25 2021 (when the Orocobre, Galaxy merger was completed) to December 31 of that year. This was for a 5.7 per cent spodumene concentrate product.
Allkem observed spodumene concentrate spot prices register record highs in the June quarter, increasing more than 50 per cent quarter-on-quarter (QoQ).
This comes as electric vehicle (EV) sales continue to rise.
Allkem estimated EV sales for the June quarter to be approximately 2.2 million units, which is up about 50 per cent from the prior corresponding period (June quarter of 2021). EV sales in China alone were estimated at approximately 1.3 million units during the quarter, representing a 90 per cent jump from the PCP.
At the same time, Allkem said spodumene concentrate production was increasing.
“Spodumene concentrate volumes shipped to China from Australia during the quarter were 50 per cent higher QoQ with brownfield expansions and restart of idled capacity,” the company said in its quarterly report.
“This incremental spodumene volume will mostly be consumed during the second half of 2022 and is expected to boost utilisation rates of lithium chemical plants in China.”
Allkem also noted that automakers were showing greater interest in the lithium industry, with Chinese and Western original equipment manufacturers (OEMs) investing and funding directly into lithium assets to secure supply.
“The race to secure key critical materials has further intensified across the EV battery value chain,” Allkem said.