<article><p class="lead">Australian lithium producer Pilbara Minerals has secured a five year offtake agreement with downstream Chinese lithium chemicals producer Yibin Tianyi.</p><p>Pilbara will supply 60,000t of lithium concentrate grading 6pc lithium oxide in 2020 and 75,000 t/yr for 2021-2024. The first shipment of 20,000t from the Pilgangoora mine in Western Australia has already been sent to China with the next shipment due in late April or early May. </p><p>Sichuan-based Yibin Tianyi is a key participant in the supply chain of Contemporary Amperex Technology (CATL), the world's largest maker of lithium-ion batteries and a shareholder of Pilbara Minerals. Yibin Tianyi plans to open a 25,000 t/yr plant in China in June with capacity to produce 25,000 t/yr of lithium hydroxide and carbonate chemicals. This capacity could be increased to 100,000 t/yr by 2022.</p><p>Pilbara Minerals has offtake agreements with China's General Lithium, Ganfeng Lithium, Great Wall Motors and CATL as well as with South Korea's Posco. </p><p>The first stage of Pilbara's Pilgangoora project has capacity to mine 2mn t/yr of ore to produce around 330,000 t/yr of concentrate, but production was moderated last year as a result of weak lithium prices and low demand. Output in January-March is expected to be at the lower end of the 35,000-50,000t range.</p><p>"Demand in the near term is likely to be tempered with consumer demand expected to remain soft in response to Covid-19," the company said.</p><p>It is progressing desktop engineering studies to increase Pilgangoora's mining capacity to 5mn t/yr, but this expansion will not occur until customer demand has increased and stage one capacity is fully utilised. </p><p class="bylines">By Angus Macmillan</p></article>
