Sociedad Química y Minera de Chile S.A.

What it is

SQM is a Chilean chemical company and a supplier of plant nutrients, iodine, lithium, and industrial chemicals — five product lines that share one advantage: all come from the mineral-saturated brines and nitrate crust of northern Chile’s Atacama Desert.

SQM’s natural resources and main production facilities are located in the Atacama Desert in the Tarapacá and Antofagasta regions. In the Salar de Atacama, SQM produces lithium carbonate and hydroxide from brine — pumping mineral-rich water, letting it evaporate in vast shallow pans, and refining the concentrate into battery-grade material.

SQM aims to maintain its leading world position in the lithium, potassium nitrate, iodine, and thermo-solar salts markets. Its iodine operations alone account for roughly 30% of global supply.

Who owns it

As of December 31, 2024, SQM does not have a controlling group as defined by Title XV of Chilean securities law — meaning no single entity holds the legal threshold for “control.” Yet two anchor blocs dominate in practice.

The Pampa Group, under the control of Julio Ponce Lerou, is the largest shareholder, holding a 26% stake as of December 31, 2024. China’s Tianqi Lithium Corp.

is the second-largest shareholder, maintaining a 22% interest after its 2018 acquisition of a 23.77% stake from Nutrien Ltd. for approximately $4.1 billion. The remaining roughly 50% floats freely, largely held by global institutions.

A dual-class share structure separates economic ownership from control, granting the Pampa Group outsized influence via Series A despite not owning an absolute equity majority. Codelco, Chile’s state-owned copper giant, will secure a majority stake of 50% plus one share in a new joint venture for Atacama lithium; while SQM retains operational control until 2031, Codelco will assume general management thereafter.

Who runs it

Ricardo Ramos is CEO. He earned an industrial engineering degree from the Pontificia Universidad Católica de Chile, joined SQM in 1989 as a finance adviser, served as CFO and Vice President of Corporate Services from 1994 until 2018, before assuming the CEO role in January 2019.

Gerardo Illanes is Chief Financial Officer, a long-serving SQM finance executive. As of May 27, 2025, Gina Ocqueteau Tacchini assumed the role of Chairwoman, with Gonzalo Guerrero Yamamoto transitioning to Vice Chairman after serving as Chairman from 2022 to 2025.

The money, in plain words

SQM had a phenomenal 2023 — revenue of $7.47B and net profit of $923M — because lithium prices were then near record highs. Both then collapsed: revenue fell 39% to $4.53B in FY2024 and was roughly flat at $4.58B in FY2025 (our calculation), as lithium prices dropped roughly 90% from their late-2022 peak.

Even so, SQM keeps about 15 cents of profit from every dollar of sales — a net margin of 15.4% — and earns back roughly 13 cents for every dollar shareholders have invested, a return on equity of 13.4%; both are respectable for a capital-heavy miner in a commodity downturn.

The balance sheet is solid: the company holds $1.75B in cash and its equity base stands at $5.69B, leaving total liabilities at $6.45B against $14.5B of assets (our calculations from EODHD balance sheet). At 26× earnings, the market is pricing in a recovery in lithium; investors are paying a premium today for what they expect the business to earn tomorrow.

SQM’s dividend policy for 2024 is to distribute 30% of annual profits — no small commitment, but the current yield registers near zero in EODHD data, reflecting timing of the distribution rather than a permanent cut.

What it is doing now

SQM’s layoffs are part of a broader cost-cutting push to offset the lithium price collapse; CEO Ricardo Ramos has emphasised that reducing expenses is essential, while trimming roughly 5% of its workforce carries the risk of delaying critical projects.

In 2024, SQM allocated more than $1.3B to expansion of its lithium operations in Chile and abroad; for 2025 it projects investment of close to $1.1B to drive growth and consolidation. Iodine is providing ballast: Q1 2025 iodine sales hit $255M — a 6.2% rise — driven by record prices of $71.4/kg.

SQM carried out a corporate reorganisation in 2024 resulting in three main divisions: SQM Lithium Chile, SQM Lithium International, and SQM Iodine-Nutrition. The split is strategic: it ring-fences the state-joint-venture lithium business from the privately controlled iodine and nutrition operations.

What to watch

• Lithium price recovery. CEO Ramos predicts a lithium price rebound by 2026. If he is right, margins will snap back sharply; if oversupply persists, the stock’s 26× P/E looks stretched.
• Codelco JV closing. The definitive agreement for joint Atacama lithium exploitation from 2025 to 2060 was signed on May 31, 2024. The formal close and transfer of operational responsibilities is the single biggest governance event on the horizon.
• Iodine as a floor. Iodine’s margins remain robust even as lithium struggles, and a seawater pipeline project set to boost iodine production by 2026 will further lock in SQM’s dominance.
• New board leadership. The board appointed Gina Ocqueteau Tacchini as new Chair and Gonzalo Guerrero Yamamoto as Vice Chairman at its May 27, 2025 meeting. Whether the new chairwoman accelerates governance reforms tied to the Codelco deal is worth tracking.

This is news, not investment advice.