Altura Secures Five-Year Lithium Offtake with Shanshan

The Australian lithium mining company Altura Mining (AJM) announced that it has signed a 2020 supply agreement and a five-year binding lithium offtake with Ningbo Shanshan's subsidiary, Hunan Yongshan Lithium. According to the agreement, AJM will provide 44,000 dry tons of 6% spodumene concentrate at market prices in 2020, according to foreign media reports.

Shanshan is considered a global leader in the production and sales of anode and cathode material to the lithium battery market. It is also Altura's second-largest shareholder with a 15.1 percent stake.

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The signed five-year lithium offtake shows that Altura will become the main supplier of Shanshan's new lithium chemical plant, and it will begin to supply in January 2021, of which the minimum annual supply confirmed in 2022-2025 is 60,000 kilotons of spodumene concentrate (SC6). It also mentioned the possibility of increasing the annual supply to 120,000 kilotons.

Shanshan's new lithium plant has a total investment of US$300 million (approximately A$437.46 million) lithium chemical plant with a planned phase one production capacity of 25,000 tons per annum lithium carbonate equivalent (LCE), and the total capacity of the second phase of expansion can reach 45,000 tons.

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"This latest off-take agreement is the result of months of close discussions to ensure that they have the exact conditions to support the new lithium chemical plant." Altura managing director James Brown pointed out that Shanshan believes they have partnered with a reliable and long-term supplier of quality spodumene concentrate. Further, they have seen the company's performance in the recent declining market as a testament to market-leading operation

At present, the price of lithium salt is at a very low-profit margin, and it is still under greater downward pressure. To lock in market share in advance and protect the profitability of enterprises, it is becoming a trend that upstream lithium salt manufacturers sign long orders with mainstream vehicle manufacturers and power battery companies. The company will supply the products under the contract and the binding lithium offtake from its Altura Lithium Project at Pilgangoora in the Pilbara region of Western Australia.

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