Chilean lithium giant SQM, known as the world’s second-largest lithium producer, announced on Monday a significant long-term supply agreement with Hyundai and Kia. This deal underscores the crucial role of lithium, a key component in electric vehicle (EV) batteries, as global automakers accelerate their transition towards sustainable mobility.

In their statement, SQM revealed that Hyundai and Kia will secure a portion of their future supply of lithium hydroxide from the company. This partnership marks another strategic move by SQM into the automotive sector, following previous supply agreements with Ford Motors and battery manufacturer LG Energy.

While financial specifics of the deal were not disclosed, SQM emphasized the deal’s alignment with their ongoing lithium hydroxide expansion plans. Currently, SQM’s Chilean operations produce 40,000 metric tons of lithium hydroxide annually, derived from lithium carbonate. The company aims to ramp up production to 100,000 tons by 2025, underscoring its commitment to meeting growing global demand for lithium.

In addition to expanding its capabilities in Chile, SQM is actively increasing its production capacities in China and Australia, reflecting a broader strategy to enhance its global footprint in the lithium market. This expansion is crucial as SQM positions itself to capitalize on the burgeoning EV market, which continues to drive demand for lithium batteries worldwide.

Moreover, SQM recently entered into a joint venture with Chilean state-run miner Codelco, focused on the Salar de Atacama. This collaboration extends SQM’s extraction rights in one of the world’s premier lithium-rich regions until 2060. Such agreements are pivotal as SQM aims to leverage its expertise and access to resources to maintain a leading position in the global lithium market.

The partnership with Hyundai and Kia represents a significant milestone for SQM, reinforcing its role as a key supplier in the EV supply chain. The adoption of electric vehicles is integral to reducing global carbon emissions and achieving sustainability goals. SQM’s proactive approach in expanding its production capacities underscores its commitment to supporting automakers like Hyundai and Kia in their efforts to meet the growing demand for EVs worldwide.

SQM is a multinational corporation specializing in the development and manufacture of a wide range of essential products across various industries critical to human advancement, including healthcare, nutrition, renewable energy, and technology. Through continuous innovation and technological advancements, SQM maintains a prominent global position in markets such as lithium, potassium nitrate, iodine, and thermo-solar salts. The company is dedicated to producing top-tier products that consistently meet the evolving needs and standards of its diverse customer base.