SIBANYE-Stillwater said it had decided to phase production from its €783m (R14.9bn) Keliber lithium project in Finland owing to market oversupply of the battery mineral.
The Johannesburg-headquartered miner said last year prices for lithium concentrate were “well below” the project incentive price of $10,000 to $5,000 LCE (lithium carbonate equivalent). While prices have revived lately, phased production was “the optimal way forward, given current market conditions”.
Details of how production will be phased are yet to be detailed publicly, but Sibanye-Stillwater said its shareholder in the project, the Finnish Minerals Group – a government company – was finalising its financial contribution including its contribution to the project’s working capital requirements.
FMG has a 20% stake in Keliber which has been designed to produce 15,000 tons a year of lithium hydroxide monohydrate, a mineral used in lithium battery manufacture.
Benchmark Mineral, an industry consultancy, sees North Asian lithium carbonate prices at $10,400 a ton this year, the same as at the end of 2024, according to a report by Bloomberg News earlier this month. The average of four analyst estimates for next year came in at $10,685/t.
There is also the risk of new lithium production hitting the market at the merest encouragement. “New supply keeps hitting the market, at the same time as higher-cost, marginal operators are not shuttering operations in sufficient volumes,” said Bank of America in November. “This is partially driven by strategy or geopolitics: producers do not want to curtail activity in a market that is growing exponentially.”
More details of how Sibanye-Stillwater intends to build Keliber’s production could be disclosed at Sibanye-Stillwater’s strategy day which has been scheduled for January 29. A capital markets day is also to take place in March given the company is under the new leadership of CEO Richard Stewart.
