The leading lithium mine company reported losses, Australian lithium mining stocks fell sharply.

The stock prices of Australian lithium mining companies have plummeted significantly, as the country's two largest battery metal producers announced total losses of $1.2 billion in the first half of the year due to a sharp decline in prices. IGO's stock in Sydney dropped by as much as 8.4%, while Mineral Resources fell by up to 6.1%. Even companies that did not announce their performance on Thursday were not spared from the downturn. Pilbara Minerals fell by up to 4.3%, and Liontown Resources fell by 5.4%. The lithium industry has suffered a double blow of asset impairments and cost controls due to oversupply and a decrease in demand for electric vehicles. Prices have fallen by 86% since reaching historical highs at the end of 2022, continuing to decline in the first half of this year. However, prices have recently rebounded following the closure of a large mine in China in recent weeks. Mineral Resources reported a net loss of AUD 904 million (approximately USD 588 million) for the year ended June 30, compared to a profit of AUD 125 million in the same period last year. IGO reported a net loss of AUD 954.6 million during this period and fully impaired its Kwinana lithium hydroxide conversion facility assets. Chris Ellison, Managing Director of Mineral Resources, said in a statement on Thursday, "We made a misjudgment on the lithium price, which has greatly impacted our profitability and net debt levels. Our focus in the near future is on costs and performance to ensure the company operates steadily throughout the cycle." However, it seems that the worst is over for lithium mining companies. UBS Group raised its price expectations for lithium ore by 9% to 32% this week, citing expectations of more widespread and severe disruptions in Chinese supply. The institution also raised IGO's target price by 20%. UBS said that the likelihood of supply disruptions in China by 2026 has increased, potentially leading to a supply shortage in the market. However, it is expected that supply will recover by then, and some idle or underutilized capacity may also come back online, possibly leading to some adjustments in 2027. IGO CEO Ivan Vella stated that the long-term prospects of the Australian Kwinana lithium hydroxide conversion facility are "challenging," but he also noted that the company believes the market fundamentals are positive.