Original article: Precio del carbonato de litio crece más de un 60% en solo un mes y reabre cuestionamientos al acuerdo SQM-Codelco

The surge of over 60% in the price of lithium carbonate within just one month has not only shaken commodity markets but also reignited scrutiny regarding the agreement between SQM and Codelco for the exploitation of the Salar de Atacama, which was signed at a time when the market was facing one of its most depressed cycles.

By Bruno Sommer

The contract, announced when lithium prices were at multi-year lows following a drastic drop of over 80% from the peak in 2022, was defended by the Chilean government as a means to ensure stable income and long-term certainty for the state. However, the recent sharp rebound is fueling criticisms about whether Chile compromised its main strategic resource at the lowest point of the cycle.

A Price Set at the Bottom of the Market

When the agreement was finalized, lithium carbonate was trading significantly below the levels currently being observed. In this context, the price assumptions used to project fiscal revenues and future returns were conservative, aligned with a prolonged oversupply scenario.

JP Morgan, one of the investment banks that analyzed the market during that period, projected that lithium could reach US$20,000 per ton by 2030, assuming a gradual recovery in demand associated with electromobility and a slow adjustment of global supply.

The costly study commissioned by Máximo Pacheco proved to be erroneous. Who will pay for the fallout now? What actions will controller Dorothy Pérez take regarding this?

Few anticipated the velocity of this turnaround, within just one month, the spot price has already risen above the US$20,000 threshold, accelerating a level that financial models placed at the end of the decade.

A Rebound that Changes the Equations

The movement was driven by a combination of production cuts, inventory adjustments in China, and signs of recovery in the battery sector. For the market, the message is clear: lithium remains a highly volatile commodity, where setting long-term conditions at a low point in the cycle can incur significant costs.

The Dilemma for Chile

In the Chilean case, the SQM-Codelco agreement was presented as a step toward greater state presence in the lithium business, but little was communicated to the public about how the state retained the treasure at 100%.

Ultimately, the contract binds the country to economic conditions defined under a scenario of exceptionally low prices, benefiting the privately-owned mining company historically linked to Pinochet’s ex-son-in-law, in case the rapid recovery continues.

Although it is premature to speak of a new supercycle, the current rebound is already forcing a review of key assumptions behind one of the most significant agreements in Chilean mining policy in decades. With lithium prices once again proving their capacity to surprise on the upside, the question is no longer just economic but political:

Did Chile negotiate its main resource for the future with a short-sighted perspective, anchored at the worst moment in the market?

All the evidence lends credence to El Ciudadano: Yes, they negotiated with the lowest prices in recent years to the detriment of the Chilean state.

By Bruno Sommer