Albemarle Corporation (NYSE: ALB) closed its Western Australia lithium refinery on Tuesday, threatening jobs for 375 workers despite recent lithium price gains that company executives say remain too weak to sustain Western processing operations.
The shutdown underscores how Chinese-dominated supply chains continue to squeeze Western lithium processors even as market conditions improve from multi-year lows.
“Unfortunately, recent lithium price improvements alone are not enough to offset the challenges facing Western hard-rock lithium conversion operations,” Kent Masters, Albemarle’s chairman and CEO, said in a statement.
The Charlotte-based company placed Kemerton into care and maintenance effective immediately after shuttering a second production line in 2024 and canceling plans for two additional processing trains. The facility had operated for less than five years.
Read: 300 Jobs Cut as Albemarle Halts Expansion at West Australia Lithium Facility
Albemarle will supply customers from its other facilities worldwide while keeping the Australian plant mothballed for potential restart if market conditions change significantly.
Australian Resources Minister Madeleine King called the shutdown disappointing for communities in Western Australia’s southwest region.
“The difficult decision taken by Albemarle reflects a simple reality that it can be an immense challenge for projects to compete in global supply chains that are concentrated, opaque and subject to market distortion,” she said.
The closure exposes persistent cost gaps between Western and Chinese lithium processors. Industry analysts estimate Western facilities require sustained prices above $20,000 per metric ton to operate profitably—a threshold current prices have not reached despite recent gains from multi-year lows.
Chinese refiners control approximately 65% of global lithium refining capacity and benefit from lower energy costs and streamlined regulations, allowing them to operate profitably at price points that squeeze Western competitors.
Kemerton converts spodumene concentrate from Greenbushes, among the globe’s premier hard-rock lithium deposits. The company owns 49% of Talison Lithium, Greenbushes’ operator, securing half the mine’s production under a joint venture agreement.
The company expects the shutdown to strengthen its balance sheet and increase adjusted EBITDA starting in the second quarter of 2026 without reducing planned annual output for the year.
Masters said closing Kemerton followed more than two years of cost-cutting efforts during volatile market conditions.
The company maintains that its Australian mining operations — including stakes in Greenbushes and Wodgina plus Western Australian exploration projects — continue as strategic priorities unaffected by the refinery shutdown.
Albemarle has held discussions with Western Australian and federal officials about the facility’s future, though no timeline for potential restart has been announced.
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