“I think what you’re seeing is that we’re getting through some of those growing pains,” the CEO, Kent Masters, said on a call with analysts. “It is a stretch and it does take some new technology and operating in some places that historically the lithium industry hasn’t done that, but it’s not impossible.”

A lot of producers in the industry will have to successfully achieve targeted milestones to close the growing supply gap, Eric Norris, president of Albemarle’s lithium segment, said in an interview.

“It is a grind,” Norris said.

Specialty chemicals maker Albemarle recently increased its lithium market outlook by 30% and now anticipates lithium demand reaching about 1.5 million mt by 2025 and 3 million mt by 2030, Masters said.

Sales are going to accelerate for electric vehicles as consumers have more energy-sensitive choices, governments push for clean energy, markets loosen up with technology, and as electric vehicles become more price-competitive with vehicles with internal combustion engines, Masters said.

“Looking at last year’s near-50% EV growth rate and the auto industry’s aspirations for a rapid transition to EVs, it is not hard to see why demand expectations are so bullish,” Masters said. "But this challenge will be meeting this demand."

Albemarle’s lithium sales hit $404.7 million in Q4 and $1.36 billion for the full 2021 year, up from $358.6 million in Q4 2020 and $1.14 billion for all of 2020.

The Charlotte-headquartered firm reported a $3.8 million loss in Q4, down from an $84.6 million profit in the same period last year. For the full year, the company’s income dropped to $123.7 million in 2021 from $375.8 million in 2020.

Albemarle's capacity is expected to more than double by 2025

CFO Scott Tozier said Albemarle plans to expand its lithium conversion capacity to 200,000 mt/year by 2025, up from 88,000 mt/year currently.

The company’s production is currently halved between lithium hydroxide and lithium carbonate but the split would favor hydroxide in the years to come, Tozier added.

Now shipping product for commercial qualification, the third and fourth conversion plants under development at Albemarle’s La Negra operations in Chile should also make their first commercial sales during the second quarter, Masters said.

Sales from the company’s Kemerton complex in Australia are expected to commence in the second half of 2022.

Albemarle was “evaluating options” beyond 2025 for restarting its lithium mine in Kings Mountain, N.C., and possibly building conversion facilities in North America and Europe, Masters said.