Ganfeng Lithium: The Sierra Leone lithium project does not involve the Strait of Hormuz and is less affected by the Middle Eastern oil crisis.

（Source: Caixin）

          Regarding the sulfuric acid supply issue, the company said that currently, due to geopolitical conflicts, sulfuric acid prices have seen a significant increase in volatility. However, judging from the company’s inventory and long-term supply agreements, overall short-term supply remains controllable, and no substantial risk of supply interruption has occurred.            

On March 31, Ganfeng Lithium (002460.SZ) released an announcement of the investor relations activity record. Regarding the impact of the Middle Eastern oil crisis on production at the Mount Marion lithium spodumene project, the company stated that the project’s electricity supply mainly comes from the power grid, so dependence on diesel for power is relatively low. However, transportation and mining still require diesel. In the long run, oil price fluctuations will affect logistics and transportation costs across the entire industry.

Regarding the Sierra Leone lithium project, the company disclosed that the project has made some recent progress. It is expected to produce approximately 2 million tons per year. The company plans to start production next year and form a relatively stable supply. The project has obtained government support and has been granted the mining rights to extract ore. The Goulamina spodumene grade is extremely favorable, offering significant cost advantages. The project uses energy from the local area and from neighboring African countries, and does not involve the Strait of Hormuz, so it is impacted less by the Middle Eastern oil crisis. In terms of public security, with support from the Malian government, the situation is controllable; up to now, no security incidents have occurred, and project production and transportation have been proceeding smoothly.

Regarding the sulfuric acid supply issue, the company said that currently, due to geopolitical conflicts, sulfuric acid prices have seen a significant increase in volatility. However, judging from the company’s inventory and long-term supply agreements, overall short-term supply remains controllable, and no substantial risk of supply interruption has occurred.

Regarding the production capacity of the Goulamina lithium spodumene project, the company disclosed that in 2025, the project will produce 330,000 tons of lithium concentrate, and most of the ore will be transported to the domestic market, with transportation running smoothly. The Goulamina spodumene project has prominent cost advantages, and the company plans to reach full-capacity production status in 2026.

Regarding future lithium products supply and demand, the company remains optimistic about demand in the lithium industry. On the supply side, some resource-end projects are affected by multiple disruptions, including geopolitical issues, environmental protection requirements, community relations, and delays in infrastructure, resulting in poor progress. In addition, there may be cases where the release of new supply falls short of expectations, and resource release may find it difficult to match the rapid growth in demand. Since the listing of lithium carbonate futures, the industry’s sales and pricing models may have undergone major changes, and they have become closely interconnected and linked with the futures market. The company leverages its advantages across both lithium salts and batteries to carry out hedging business, which helps smooth out risks from price volatility and leverage the integrated upstream and downstream advantages.

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