Liontown Resources Pens Lithium Offtake Agreement with China's Canmax

Liontown Resources (ASX:LTR,OTC Pink:LINRF) has executed a binding offtake agreement with Chinese conglomerate Canmax Technologies (SZSE:300390) as part of its strategy to diversify its customer base.

“Listed on the Shenzhen Stock Exchange, Canmax is one of the world’s leading manufacturers of lithium-ion battery materials, including lithium hydroxide, lithium carbonate and other products and a key customer of several Australian and international material producers,” the company wrote in a Tuesday (December 9) release.

The deal is for 150,000 wet metric tonnes per year of spodumene concentrate over two years in 2027 and 2028.

“(Canmax’s) participation in our 2025 institutional placement signalled strong confidence in the longterm potential of Kathleen Valley, and this Offtake Agreement reinforces their commitment,” said Liontown Managing Director and CEO Tony Ottaviano, adding that the arrangement will allow the company to receive fair value for its products.

The company said that pricing will be determined using a formula referencing spodumene concentrate, and that it will continue its strategy of platform-based spot sales to ensure fair value for its products.

It added that its agreement with Canmax complements its existing arrangements with tier-one customers.

Kathleen Valley is Western Australia’s first underground lithium mine, with its plant reaching commercial production in January of this year. According to Liontown’s June quarterly activities report, released on July 29, Kathleen Valley produced over 300,000 wet metric tonnes of spodumene concentrate during its first 11 months of operation.

Liontown raised approximately AU$316 million in August via a two-tranche placement.

Of that amount, AU$266 million came from an institutional placement to new and existing investors, including AU$50 million from the National Reconstruction Fund. The company attained a further AU$50 million from Canmax and other institutional investors through a non-underwritten conditional placement of new shares.

In late November, Liontown announced that its first digital auction for spodumene concentrate attracted nine countries, securing a bid of US$1,254 per dry metric tonne. Liontown shared in the November update that it remains on track to meet its 70 percent lithia recovery target by the end of the third quarter of 2026.

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Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.