Financial Diary – Santiago
SQM, the second largest lithium supplier in the world, is resuming operations in northern Chile following the lifting of road blocks by local communitiesa company official reported Monday.
The last blockades that had restricted the movement of workers and supplies for almost a week were lifted on Sunday, as authorities try to calm community concerns about plans to increase production of the battery metal. This will allow the company to gradually return to normal, the official said.
The communities claim that they were not adequately consulted before the agreement between SQM and the state-owned Codelco reached at the end of Decemberwhich would allow production to be increased in the Atacama salt flat within the framework of the Government’s new public-private model. The communities have been pushing for President Gabriel Boric to visit the area.
Some groups continued protesting over the weekend, despite an agreement reached late on Friday by the Council of Atacameños Peoples (CPA) to end the blockades.
Although companies and authorities have expressed their intention to involve indigenous groups in decision-makingthe reaction to the agreement shows the challenge facing Boric’s plan.
The association between SQM and Codelco is a cornerstone of the president’s public-private model, as the government prepares to open new production areas at a time of growing global demand for the key component of electric vehicle batteries.. Chile is the country with the largest lithium reserves in the world, but it has been losing market share, as production is currently limited to just two operators.
SQM shares fell 11% in New York last week, the worst week since the government’s lithium policy was announced in April.