(Adds background, details on Burwill)
Aug 26 (Reuters) - Australian lithium miner Alita Resources Ltd A40.AX said on Monday it was in talks to sign new supply deals after the backer of a key Chinese customer reported financial troubles.
The hunt for new partners comes amid worsening market conditions for lithium, a key ingredient in the battery industry, due to lower demand from Chinese customers after a change in the country's electric vehicle subsidies, and escalating global trade tensions. a bid to diversify its customer base, Alita is currently in talks with multiple parties, including some from Korea and Japan, regarding offtake arrangements for supply of spodumene, it said in a statement. Spodumene is a hard-rock mineral mined for lithium.
The company, which is also listed in Singapore, said it was speaking to current offtake partner Jiangxi Bao Jiang Lithium Industrial Ltd, a chemicals maker, to restructure its existing spodumene supply agreement.
Hong Kong-listed Burwill Holdings Ltd 0024.HK , which owns a 50% stake in Jiangxi and is a guarantor of 50% of Jiangxi's obligations under the offtake agreement, said last week that it had defaulted on payment of a loan facility. had added that its business operations were "mostly suspended" due to difficulties stemming from the massive drop in prices for lithium products and reduced demand for steel, which had hit its cash flow.
The steel trader last week said it expects to report a loss for the first half, against a profit it posted last year.
Alita, too, had said last week that it had taken a price cut on its shipments of lithium concentrate to Jiangxi below the agreed floor price, as it sought to offload its stockpile amid the tough conditions. strapped Alita added that it was considering various refinancing options with a range of stakeholders, but that no definite deals had been made yet.