PERTH (miningweekly.com) – Lithium miner Orocobre has reported a 35% increase in lithium production from its Olaroz project, in Argentina, during the quarter ended September.

Lithium production reached 3 093 t in the first quarter of its 2020 financial year, compared with the 2 293 t produced in the previous corresponding period, following a strategy of managing brine quality, new pond preparation and tailoring production to seasonal conditions.

Orocobre on Tuesday said that the production increase was achieved despite extended maintenance activity during August, which saw a full plant shutdown for a five-day period, and one of the two reactor units being off line for a full month.

Sales tonnage for the first quarter was also up by 45% on the previous corresponding period, to 3 108 t, with revenue down by 30%, to $22.1-million, as the average sales price for lithium nearly halved from $14 699/t to $7 111/t.

Orocobre told shareholders that full-year production for 2020 was expected to be at least 5% higher than the 2019 figures, while average sales prices for the December quarter are expected to decline further to between $6 200/t and $6 500/t.

The company reported that short-term demand remained subdued, owing to slower Chinese electric vehicle (EV) growth, cathode/battery performance challenges and the US and China trade war.

However, Orocobre said that signs of strong long-term demand continued to build.

“While weak market conditions have persisted for longer-than-expected, a recovery is expected when the battery supply chain reaches more manageable inventory levels. A strong acceleration in market demand growth is expected in the medium to long term, as EV manufacturing profitably improves, total cost of EV ownership lowers and battery technology objectives within the EV and energy storage systems segments, including energy density, range and safety are achieved.”