SQM(US:SQM) Zhi Tong Cai Jing·2025-12-30 02:51Core Viewpoint - The joint venture between Codelco and SQM aims to become the world's largest battery metal producer, focusing on low-cost and low-impact production to meet the growing demand for lithium [1][2]. Group 1: Joint Venture Details - The joint venture, named NovaAndino Litio, is a public-private partnership that will allow Codelco to enter the lithium production sector [1]. - Codelco will acquire a majority stake in SQM's lithium operations in Chile, while SQM's operational period will be extended by 30 years [1]. - Codelco's chairman, Maximo Pacheco, will serve as the chairman of the joint venture's board [1]. Group 2: Market Context and Strategic Goals - The joint venture is part of outgoing President Gabriel Boric's strategy to increase national control over strategic lithium assets and to boost supply amid a global transition away from fossil fuels [2]. - Chile aims to reclaim market share lost to Australia and Argentina in recent years [2]. - NovaAndino plans to expand production from the current annual output of approximately 230,000 metric tons [2]. Group 3: Future Ownership and Regulatory Challenges - By 2030, Codelco will hold 50% plus one share of the joint venture, while SQM will retain operational control until then [3]. - SQM's major shareholder, Tianqi Lithium, is attempting to block or suspend parts of the partnership through the Chilean Supreme Court, claiming the deal should have been subject to a shareholder vote [3]. - Chinese antitrust regulators have conditionally approved the partnership, requiring both companies to fulfill existing contracts and supply products to Chinese customers on a fair and non-discriminatory basis [3].