Just along the line of 'value'. After someone asked me the question about brines and the potassium chemicals and how they had only heard about this here on hC and nowhere else was it mentioned. So I did a little hunting.
In the SQM annual financial report, the first thing I noticed is that you need to find a forensic accountant to work out exactly what is happening where, but there is one page that gives a nice breakdown. That is note 26.2 of the financial report on page 173. from the financial statements 31/12/15
http://ir.sqm.com/English/investor-relation/Quarterly-information/default.aspx
revenue total $US1.728b
specialty nutrients $US652m
Iodine +its Derivatives $US262m
Lithium and Derivatives$US223m
Industrial Chemicals $US97m
Potassium $US430m
other products $US62m
They then have all types of revenue between internal segments, then come up with a cost of sales for each segment depreciation etc, before working out a profit for each segment then take off an amount for intersegment amounts before coming up with a net income.
Considering the chemicals are all coming from the same sources the brines, I have no idea how they can separate things the way they do, but overall from their entire operation the lithium is only providing 1/8 of the revenue, so to double lithium sales, would mean doubling everything else in quantity but would it double in revenue?? I don't think so, especially if every other brine operator is doing the same thing.
Their overall costs were $US1.5b so it is hard for me to see that they could increase their lithium operation without it becoming much more expensive to produce, because at present the lithium products are the by-products compared to plant nutrients and potassium revenues.
My overall interpretation is that the brine operators need much higher lithium prices for them to contemplate increasing in size unless there are markets for all the other products that are growing at the same rate.
Anyone that comes onto these forums and talks about how cheap the brines are to produce, has not looked at the overall situation of the brine operation, because it is just not that simple.
Reading that financial report gives me so much more confidence in the hard rock resources like ours. We easily have the best, and most importantly the easiest to expand without worrying too much about by product credits like the brines like SQM have to do.
All the best and happy reading if you can be bothered.
(20min delay)