SQM reported a significant increase in earnings in the first quarter of 2022, what were the biggest contributing factors to this impressive performance?

Our exceptional first-quarter results are a reflection of several positive circumstances and constant hard work. Our success can be attributed to several factors, including large investments that were financed by our shareholders and bondholders. Additionally, we executed an ambitious investment plan flawlessly, and our dedicated SQM team played a crucial role in achieving these remarkable results.

Furthermore, we’ve seen a surge in demand for electric vehicles worldwide, which has resulted in a price increase in the lithium industry. Our investments have allowed us to produce and sell larger amounts of product while also developing products with higher added value and better quality, which command higher prices. This has helped us to increase revenue significantly.

In the iodine market, we have experienced a significant recovery in demand after a sharp drop during the early stages of the pandemic. We are investing heavily to increase our production capacity by 1,000 t/y by the end of this year and another 2,500 t/y by the end of next year. Simultaneously, we are working on developing a seawater pipeline that will reduce continental water consumption, and we expect this will have a positive impact on our productivity.

Finally, the fertilizer market has been affected by the situation in Eastern Europe, which has impacted the supply chain of potassium chloride, while logistic difficulties worldwide continue to impact markets.

Can you provide more information about SQM’s US$400 million investment to expand lithium carbonate production capacity?

Our investment plan is ambitious and aims to allocate US$2.25 billion between 2021 and 2024. With regard to lithium production in Chile, we plan to increase our production capacity from 120,000 t/y of lithium carbonate to 210,000 t/y by mid-2023. This is a significant achievement because we are reducing our extraction of brines from the Atacama Salar by 50%, on a voluntary basis, while still managing to increase our production capacity.

Furthermore, we are investing in additional lithium hydroxide capacity to produce 40,000 t/y, and incorporating technology that allows us to produce products with higher added value and better quality.

Moreover, we are increasing our iodine production capacity in Chile by 3,500 t/y and increasing nitrate processing by more than 300,000 t/y. Finally, we are working with our partners at Wesfarmers on the development of the Mount Holland lithium project in Western Australia, which is a 50/50 joint venture. This project will initially produce 50,000 t/y of lithium hydroxide, which will be a significant addition to our lithium production capacity.

Can you provide some details about SQM’s ESG initiatives?

SQM has a very strong commitment to sustainability, and we have developed a robust sustainability program that reflects our goal of becoming leaders not only in production costs, but also in adding to the best world standards in sustainability in our production of potassium nitrate, solar salts, iodine, and lithium. As part of this program, we have set ambitious targets for reducing brine extraction and continental water consumption, as well as for achieving carbon neutrality in all our products.

In terms of specific targets, we plan to reduce brine extraction by 50% by 2030, and we are on track to meet this goal, with a 20% reduction in 2020 alone. We are also committed to reducing our continental water consumption in all operations to achieve a 40% reduction by 2030 and 65% by 2040. Additionally, we aim to be carbon neutral in all our products by 2040, and in the case of lithium, potassium chloride, and iodine, by 2030.

We are also committed to maintaining and deepening the responsible management of the natural resources we use and working together with communities to support the care and protection of these ecosystems. We have signed general relationship agreements with three communities (Toconao, Rio Grande, and Talabre) and are in the process of signing at least three more general agreements with other communities. These agreements are intended to support the development of the communities for their life plans, and we are committed to working with communities to establish new forms of associative relationships.

How does SQM balance growth with the care of indigenous interests?

At SQM, we are committed to supporting the development of communities and to working with them to establish new forms of associative relationships. One example of this is the agreement we signed in 2020 with the Community of Camar, which allows for the development of a new form of associative relationship with a community with which there had been a tense situation in the past for different reasons. This agreement established a standard to be considered for future agreements with communities originating from the Salar de Atacama.

We believe that it is possible to achieve a balance between the growth of the company and the care of indigenous interests. We are committed to supporting the development of communities and to working with them to establish new forms of associative relationships that take into account the needs and aspirations of these communities. We believe that these relationships can help to ensure that our growth is sustainable and that we are able to operate in a way that is responsible and respectful of the indigenous people who live in the areas where we operate.