[ferro-alloys.com]While lithium and potash are often found in the same deposits and mined together, analysts believe the increasing number of companies racing to produce the white metal, key ingredient for making batteries that power electric vehicles (EVs) and high tech devices, won’t have an impact in the potash market.

Several lithium mines produce potash as by-product, which — at least hypothetically — could add a significant amount of supply. But the story is more complex than that, says Humphrey Knight, Potash Analyst at business intelligence company CRU.

“Not all brine-based lithium projects will make substantial quantities of potash. It depends on brine composition and it is up to an individual project’s design to incorporate a potash-production facility,” Knight told MINING.com.

He noted that only brine-based lithium projects, such as those in the lithium triangle in South America, can generate potash by-products. Additionally, Chile’s SQM, one of the world’s largest lithium miners, which also produces potash, is in the process of reducing output of the fertilizer ingredient and focusing on increasing lithium production instead. “In this case, an increased lithium production is denting potash output,” Knight said.

Contrary to those who insist the potash market remains depressed, the CRU expert believes that it’s looking very strong at moment. In 2017, producers in Canada, Russia and Belarus achieved record (or near-record) sales with demand dramatically increasing around 10% over 2016. Although demand has flattened this year, producers are still recording high sales volumes, Knight noted.

Major price indicators paint a clear picture of the potash industry’s status. South East Asian import prices, for one, are at their highest in more than two years, while in Brazil, the largest potash consumer, import prices are at their highest in over three years.

New projects delivering less than anticipated, and supply restraints (including idling and closures) have also helped keep the market relatively tight.

• [Editor:王可]