China's Ganfeng Lithium first-quarter profit surges, helped by higher prices

(Reuters) - Ganfeng Lithium Co, one of the world's top lithium producers, on Wednesday posted a sixty-fold rise in first-quarter profit as higher prices for the commodity used in electric-vehicle batteries added to bumper income from financial assets.

The Chinese company, which counts automakers Tesla and BMW among its customers, said in a filing its net profit in January-March was 476.1 million yuan ($73.44 million).

That was up from 7.75 million yuan in the first quarter of 2020, when a knock to demand from coronavirus exacerbated lithium oversupply and further depressed prices, but was down from 694.2 million yuan in the fourth quarter.

This year, first-quarter revenue almost doubled to 1.61 billion yuan as lithium prices rallied amid resurgent demand from China's electric-vehicle sector, while a 174.1 million yuan gain on the value of financial assets such as derivatives swelled Ganfeng's bottom line.

Helped by higher lithium prices, Ganfeng rival Tianqi Lithium Corp had on Tuesday reported a narrower net loss in the first quarter versus a year earlier and signalled it could return to profit in the second quarter.

Another supplier of lithium to Tesla, Sichuan Yahua Industrial Group Co Ltd on Wednesday said its first-quarter net profit rose thirteen-fold.

Yahua plans to expand the annual capacity of its battery-grade lithium hydroxide plant that supplies Tesla, in China's southwestern Sichuan province, from 20,000 tonnes to 50,000 tonnes.

($1 = 6.4830 Chinese yuan renminbi)

(Reporting by Tom Daly; editing by David Evans)