Lithium exports gain pace in Argentina

According to the latest report from Argentina’s National Mining Secretariat, lithium is not far from taking over as the leading mining industry item, whereas gold and silver continue to lead.

The document released by the agency headed by Mining Minister Fernanda Ávila shows data up to July of 2022, proving that last month mining exports amounted to US$ 291 million, 15% more than in July 2021, accumulating US$ 2.209 billion in the first seven months of the year, a 31% growth YoY.

The United States is also very interested in Argentine lithium. A year ago, a study by the Center for Strategic and International Studies (CSIS) pointed out that Argentina “is the most promising case for the expansion of the lithium industry.” The country, the study emphasized, has the second largest reserves in the world, behind Bolivia, and the third largest “commercially viable” reserves, behind Chile and Australia, and highlighted two operations in progress, in Jujuy and Catamarca: the Olaroz and Hombre Muerto salt flats.

The study, signed by Ryan Berg, Senior Researcher at CSIS, underlined that the country is the main supplier of lithium to the USA, and based on official data, it specified that between 2016 and 2019, 55% of the lithium imported by the USA came from Argentina, followed by Chile (36%) and China (5%).

Behind this dynamism of lithium is the so-called “energy transition,” concepts such as “electromobility,” phenomena such as Tesla, with an impact on the global automotive industry, and the increase in the prices of minerals needed to manufacture batteries, such as nickel, graphite, and lithium. According to Trading Economics, in the last twelve months, the price of lithium carbonate increased 335%, while the price of gold and silver fell 5% and 21%, respectively.

Mining exports still do not have a great weight in Argentina’s exports: in the first seven months, they accounted for little more than 4% of the total. But it is one of the sectors in which the economic team headed by Sergio Massa is betting on attracting international investments with export projections.

The main limitation continues to be the exchange rate regime and how unattractive it is for foreign investors to bury capital in a country that does not provide security of access to foreign currency.

Gold (61.5%) and silver (38.3%) account for more than 99% of Santa Cruz’s mining exports, while gold alone accounts for 96.5% of San Juan’s exports. In the northwestern provinces, the basket is more balanced and is shifting towards lithium, which in the first seven months of the year accounted for 52.7% of mining exports, compared to 24.3% for gold and 15.7% for silver.

As for the destination of exports, Switzerland (35.2%), the USA (33.1%), and Canada (21.9%) absorbed more than 90% of gold and silver exports from Santa Cruz and Switzerland (51.4%) and India (45.1%) more than 95% of those from San Juan. The provinces of the so-called “lithium triangle” have a more diversified clientele: they sell 25.7% of their minerals to the USA, 24.8% to China, 17.2% to Japan, 10.3% to South Korea, and 22% to the “rest of the world.”

Source: MercoPress

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