Sobre el acuerdo Codelco-SQM, diputados pidieron eliminar que se venda el 100% del potasio a la empresa de Julio Ponce.
The National Economic Prosecutor’s Office (FNE) complicated the agreement between Codelco and SQM by failing to consider SQM’s purchase of 100% of the potassium chloride production from their joint venture with the state-owned company (Tarar). Potassium chloride is key in the production of potassium nitrate, a market in which the company linked to Julio Ponce holds a 41% global share for agricultural use. However, a further complication could impact potassium production in Chile: new lithium extraction technologies.
Juan Carlos Guajardo, Executive Director of Plusmining, and Andrés González, head of mining industry analysis at the consultancy, explain that Chile’s potassium is largely produced as a by- product of lithium operations.
However, greater lithium output will not necessarily lead to more potassium. “It must be noted that its recovery as a by-product comes from lithium production via evaporation. Direct lithium extraction technology does not yield potassium as a by-product, so progress in its implementation will limit potassium production compared to the current situation,” they state.
For example, the lithium extraction proposal for the Maricunga salt flat includes the use of this new technology (see main article).
Stagnation in potassium production due to new technologies would occur despite experts forecasting strong mineral demand in the coming years. This demand stems from its increasing use as a fertilizer, supported by projections of growing global food needs. However, Chile is already showing a decline in potassium compound production. According to Sernageomin, between 2014 and 2023, potassium product output dropped by 37%.
SQM is the largest producer of potassium nitrate for agricultural use globally, though this is only one of the forms in which potassium is marketed. Considering other potassium compounds, Chile represents 2% of global production, according to a 2024 Cochilco report.
Investigative Commission
Separately, the investigative commission into the Codelco-SQM agreement, formed in the Chamber of Deputies, approved the report issued by the body. In the document, the deputies state that the “partnership agreement must be annulled” due to “the lack of transparency that has characterized the entire negotiation, approval, and communication process.”
Regarding the potassium sales agreed upon in the joint operation with SQM, the report recommends this obligation be “eliminated.”
“The authorities must avoid deepening and consolidating SQM’s monopolistic position in the fertilizer market, and should open the sale of the produced potassium to participants in a competitive and transparent process, ensuring the best benefit for the State and a less concentrated market,” the report states.
The report will now be voted on by the full Chamber of Deputies.
Source: El Mercurio