Orocobre Ltd. reported in early February that the final circuits have been commissioned at the Olaroz lithium brine project in Jujuy province, northern Argentina, and that the project is being ramped up to its design capacity of 17,500 mt/y of lithium carbonate.

The project is owned 66.5% by Orocobre, an Australian company headquartered in Brisbane, Queensland; 25% by Toyota Tsusho Corp.; and 8.5% by JEMSE, a mining investment company owned by the government of Jujuy province.

The Olaroz plant is now supplying samples of its lithium carbonate production to more than 30 battery and industrial customers in Asia, Europe, and the United States to complete the final stage of its product qualification and approval process. Additionally, a number of customer contracts have been finalized for product supply in 2015.

The Orocobre announcement remarked that the company is entering the lithium carbonate market at a time when supplies are tight due to a combination of strong market demand and existing suppliers effectively being at capacity.

Apart from Orocobre, no new entrants are scheduled to come into production on the supply side and no capacity expansions are due to come online outside China until at least 2016.

Meanwhile, independent consultants project lithium carbonate demand to grow by about 10% per year for at least the next few years.

“These factors have combined to create a market environment where customers value security of supply and have a focus on diversifying their supply chain to manage supply risk. These are very favorable conditions for a new supplier to be starting production, negotiating supply contracts, and initiating supply to customers,” the Orocobre announcement concluded.

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