Lithium hydroxide
A decades-old battle of grease manufacturers over lithium hydroxide imports comes to an end. An action by the IBP with the Ministry of Economy bodies resulted in the Presidential Decree nº 11.120, of July 5, 2022, which allows for foreign trade operations in lithium minerals and ores and their derivatives.
Until the publication of the aforementioned decree, grease producers were prevented from importing lithium hydroxide in reasonable quantities, as decree No. Until 2020, foreign trade operations for lithium materials will only be carried out with prior authorization from the National Nuclear Energy Commission (CNEN)”.
In practice, according to grease producers, this body only released extremely small amounts, when it did not prevent imports. Thus, the Brazilian market was dependent on only one domestic producer of lithium hydroxide, characterizing a monopoly, with prices much higher than the international market.
In 2020, driven by its lubricants commission, the Brazilian Institute of Oil and Gas started working with the Regulatory and Competition Assessment Front – FIARC of the Ministry of Economy, which led to the SEAE/SEPEC/ME/Nº 3/ Public Hearing. 2021- on July 28, 2021, which, after almost a year of expectation, including complaints and attempts at contrary appeals, brought the long-awaited solution to the grease market, with extension to others that use lithium derivatives.
In a special note to Lubes em Foco, IBP expressed its satisfaction with the result.
The Brazilian Institute of Oil and Gas (IBP) defends the principles of economic freedom and the free commercialization of commodities, fundamental for the supply of several sectors.
“In this context, the IBP recognizes as positive the publication of decree nº 11.120 of the Presidency of the Republic, of July 5, 2022, which allows the performance of foreign trade operations in minerals and lithium ores and their derivatives, inputs used in the manufacture of greases and lubricants.
The elaboration of analyzes and the provision of data on the structure of the lithium industry and the dynamics of operations in the segment were fundamental for the technical basis that resulted in the decree. The information was produced within the scope of the Intensive Front for Regulatory and Competitive Assessment (FIARC), conducted by the Secretariat of Advocacy for Competition and Competitiveness (SEAE), of the Ministry of Economy, together with the IBP.
The Ministry of Mines and Energy acted proactively to reinforce the importance of opening up the lithium segment.
The opening of foreign trade to mineral and its derivatives is another important step in strengthening commodity markets that are strategic for any globalized economy.”
See the full text of the decree below.
