FMC will launch an initial public offering of 20% of its lithium mining subsidiary Livent to raise $100 million, S&P Global Market Intelligence reports. Livent sources lithium from Argentina whereas its largest competitor, SQM, is focused on Chile where water shortages may disrupt supplies according to Reuters.
Such a disruption would follow a surge in Chilean exports, including a 13.7% increase in exports in the second quarter, Panjiva data shows. That was led by a 47.7% surge in shipments to South Korea which came at the expanse of Chinese buyers which saw imports drop 29.3%.
Source: Panjiva
An interruption to Chilean exports could also exacerbated the surging cost of lithium for battery manufacturers. The average export value per ton reached a record $14,093 per ton in June, up 25.2% since the start of the year.
Source: Panjiva
A shortfall in SQM’s production in Chile would also help FMC cement its lead in the U.S. market where its shipments outnumbered those of SQM by 5.4x in the 12 months to August 26.
Source: Panjiva
Similarly such a drop would help FMC diversify its exports from Argentina to China. In the first quarter Chilean supplies accounted for 44.5% of imports vs. Argentina’s 30.3% but the latter relied on five buyers for 88.1% of its supplies vs. 75.6% for Chile.
Source: Panjiva