The world’s No. 2 lithium producer SQM shipped record-high volume last quarter and vowed to keep growing production in Chile even as slumping prices prompt a review of “less attractive” markets. 

A 20%-plus jump in volume of the battery metal shows SQM is plowing ahead with expansions at its low-cost operations in the Atacama Desert. It’s a bet on growing market share as other producers curtail output and spending in response to the lowest prices in three years.

While SQM remains optimistic about consumption, estimating demand growth of about 20% this year, it reported a bigger-than-expected slump in quarterly profit and signaled prices would remain in the doldrums in the second half.

“While we continue to advance our previously announced expansions, we are currently re-evaluating specific markets and initiatives that may be less attractive in the near term,” CEO Ricardo Ramos said.

Some of SQM’s rivals are already going on the defensive. Top producer Albemarle Corp. plans to shut half its current processing capacity in Australia and put an expansion there on hold. Some smaller, higher-cost miners have already shuttered mines, including Core Lithium Ltd. In China, Zhicun Lithium Group Co. has placed two carbonate units into care and maintenance.

Other producers may reduce their output, Ramos said, “as many projects, especially greenfield, are not economically viable at these prices.” Benchmark Mineral Intelligence estimates that the market won’t return to deficit until the end of the decade.

Meanwhile SQM’s plants in northern Chile continue to ramp up production toward a recently expanded annual capacity of 210 000 metric tons. Further expansions would take capacity toward 300 000 tons, although that will depend on execution of a deal to hand over a majority stake in SQM’s brine assets to state-owned Codelco in exchange for extending operations.

SQM has some of the industry’s lowest costs. It’s able to tap into the world’s richest brine deposit and employ an evaporation technique that uses far less fresh water, chemicals and energy than hard-rock mining as practiced in top producer Australia.

Chile’s government shares SQM’s growth strategy as authorities look to open up new areas to mining and encourage more processing. More threatening than oversupply in the coming years is the risk of a renewed shortage, which would send prices soaring and make alternative battery technologies more viable, Finance Minister Mario Marcel said in March.

SQM shares were up 1.8% at 11:53 a.m. in New York, paring a year-to-date decline to 37%. Executives from the firm formally known as Soc. Quimica & Minera de Chile SA will hold a conference call at noon.