15 Mar Chile attempts to block Chinese approach as global lithium heavyweights clash
The government of Chile has appealed to antitrust regulators regarding an attempt by a Chinese firm to purchase a US$4 billion equity stake in the major Chilean lithium producer SQM.
Chile development agency Corfo, which manages SQM’s lithium leases in the Salar de Atacama, filed a 37-page complaint relating to the approach by Tianqi Lithium, claiming that a deal would give the Chinese company an unfair advantage in the race to secure resources to develop electric vehicles.
The report warned that an acquisition of the 32% stake in SQM by Tianqi, or any entity controlled by the Chinese government, would “gravely distort market competition.”
The stake is being sold by Canadian fertiliser company Nutrien, with four other companies said to be vying for the stake – all of them Chinese, except for Anglo-Australian giant Rio Tinto.
“[SQM and Tianqi are] extremely close competitors…and were one to acquire an interest in the other – even minority – it would have serious anti-competitive impacts on the market,” wrote former head of Corfo Eduardo Bitran in the complaint.
Together, Tianqi and SQM would control 70% of the global lithium market, the document said. The traditional oligopoly in the lithium market is comprised of US-based firms Albemarle and FMC Lithium, along with the two parties embroiled in this dispute.
This market cartel is said to control up to 85% of the world’s lithium production.