Lithium crisis hits China's industry giants: Tianqi and Ganfeng in trouble

The Chinese lithium giants Tianqi Lithium and Ganfeng Lithium Group report alarming figures: nine months into the year, both companies remain underwater, affected by the unchecked price decline of the battery metal. On Wednesday, the companies released their reports, highlighting significant challenges for the industry as prices fall and an oversupply floods the market. Tianqi recorded a loss of 5.7 billion yuan and experienced a further loss of 496 million yuan in the third quarter—a severe setback following a profit of 1.65 billion yuan in the previous year. Despite increasing production and sales volumes, the drastic price decline could not be offset. Ganfeng also struggles with adverse market developments: the lithium producer reported a modest quarterly profit of 120 million yuan, supported by a one-time profit surge of 311 million yuan from the revaluation of financial assets. This marks the first profit in four quarters, but challenges remain. The ongoing crisis has already led to global project halts, failed deals, and production cutbacks as companies strive to protect their margins. Australian mining company Pilbara Minerals will temporarily put its facilities on maintenance starting in December, a step Albemarle in Australia took three months ago. Despite the headwinds, Ganfeng remains optimistic about medium- to long-term lithium demand. The company forecasts moderate global supply growth for the coming year, given the current price situation.