Declining prices of spodumene — a crucial raw material for electric vehicle batteries — has Arcadium Lithium Ltd reassessing its operations at the Mount Cattlin Lithium Mine in Western Australia.
Arcadium CEO Paul Graves indicated that the company was considering cost-cutting measures following a 5% quarterly profit drop, which met market expectations despite challenging market conditions.
Graves highlighted concerns over the sustainability of current operations at Mount Cattlin, where costs are US$700 per tonne amidst falling spodumene prices.
He emphasised the possibility of shifting to care and maintenance mode depending on market developments, stating, "The question of care and maintenance ... we're asking those questions pretty intensively internally, about is that the right strategy for Mount Cattlin right now."
The current price for spodumene AM-LI2O5 in China, the largest consumer, has dipped to around US$940 per tonne — an almost three-year low. This downturn has squeezed margins for Arcadium and other lithium producers, prompting the strategic review of operations.
Graves indicated that while specific decisions hinge on ongoing price trends, sustained low prices could significantly influence their operational strategy moving forward.
Arcadium's proactive stance reflects broader industry challenges amidst fluctuating demand and pricing dynamics in the global lithium market.