Chilean lithium giant SQM announced Thursday it will auction some spodumene concentrate online using the Metalshub platform, a move already adopted by its peer Albemarle.

SQM International Lithium (SQMi) seeks to sell around 10,000 tonnes of spodumene concentrate from Perth, Australia on 20 November. The USD deal will be based on cif terms to Qinzhou China or main Chinese port.

Mark Fones, chief executive of SQMi shared excitement in a statement, adding further bidding events are planned for 2025, thanks to “positive feedback” from market participants. “Through this initiative, SQMi expects to promote fair and more transparent pricing information enhancing the lithium market efficiency,” he adds.

US Chemicals company Albemarle has been using the mechanism since March. It has two new auctions scheduled for 13 November, offering two 100-tonne cargoes of battery-grade lithium carbonate.

One lot of the lithium chemical was converted by Jincheng Lithium and the other by Zhiyuan Lithium, using spodumene from the Greenbushes mine in Australia. The product will be available in CNY, on an ex-works China basis.

Metalshub, a partner of the London Metal Exchange, says its digital bidding events help to increase transparency in lithium price discovery, which is often done through price reporting agencies (PRAs) or commodity exchanges.

Traditionally, lithium is sold through a mix of long-term contracts and spot deals. A few years ago, lithium supply struggled to keep up with surging demand for batteries and EVs, driving prices to peak at nearly $80,000/tonne in December 2022. However, that has changed since, with prices dropping around 80%.  

“A sound mechanism for price discovery becomes vital to a company’s success,” Metalshub says. “Digital bidding events represent a modern approach to price discovery.”

As an independent software provider, Metalshub enables sellers to invite bids from potential buyers and conclude legally binding transactions digitally. Different auction formats may be chosen. The process is set to be secure and efficient, allowing the seller to evaluate multiple bids and select the most competitive one. Bids are confidential.

“The democratisation of information through these events reduces the risk of information asymmetry and bias,” Metalshub adds.

The company has over 200 raw materials traded on its platform, including nickel, cobalt, manganese and copper.

Australian lithium producer Pilbara Minerals was one of the pioneers in using digital auctions to gauge market appetite and increase price discovery transparency.