Lithium Producer Albemarle Sees Higher Stock Price Early in 2021

Albemarle, a chemical producer, had a rollercoaster of a year in 2020 amid the coronavirus pandemic. The company's stock price just increased.

Kori Williams - Author

Jan. 6 2021, Published 3:06 p.m. ET

what does albemarle do

Albemarle Corporation, a chemical producer, had a rollercoaster of a year in 2020 amid the coronavirus pandemic. Albemarle works on a global scale in all kinds of industries. 

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Despite Albemarle's growth in the global chemical industry, it didn't start out in this field. The company's website says that it started in the late 1880s as a paper producer. Over the years, the company expanded through a number of acquisitions.

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What Albemarle produces

On Albemarle's website, the company calls itself a leading producer of lithium, bromine, and catalyst solutions. These chemicals are used to make all kinds of products like pharmaceuticals, electronics, and electric cars. 

While Albemarle doesn't directly make these products, it supplies the companies with the necessary chemicals do to so. Albemarle also works as sustainably as possible to produce these chemicals to limit negative impacts on the environment. 

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Albemarle has customers in various industries

Since Albemarle works with chemicals that are necessary for a number of different industries, it has customers in all kinds of industries. While Albemarle doesn't openly name what companies it supplies, it's a top lithium producer. 

Lithium is used in many products, but it's a key component in electric car batteries. Companies like Tesla and Lucid Motors may depend on Albemarle to supply them with the lithium needed to keep their vehicles running. 

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Albemarle is a public company

Albemarle is a public company with a current stock price of $176.15. The company has a number of Institutional investors that, according to CNN Money, control over 90 percent of the shares. The investors include Baillie Gifford & Co., The Vanguard Group, Inc., PRIMECAP Management Co., and more. 

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Albemarle's lithium stock prices struggled in 2020

Going into 2020, the market for lithium was already "suffering from a mismatch in supply and demand," according to The Motley Fool. Companies like Albemarle were dealing with the struggles that the year was forecasted to bring. However, the coronavirus made 2020 worse than expected. 

The Motley Fool said that in March 2020, Albemarle's stock price fell by more than 31 percent, which correlates to the timing of the quarantines amid the COVID-19 pandemic. 

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However, because of the EV Boom, the demand for lithium, one of the chemicals that Albemarle specializes in, has gone up from 14 percent use in batteries in 2019 to 50 percent. A positive outlook may have helped Albemarle stay afloat.

In 2020, Albemarle lithium president Eric Norris told Bloomberg, "We have the financial capability and the operating and the project capability to scale when the market returns." There's an expected shortage of lithium in 2023 due to the current increase in demand.

Norris believes in lithium's growth in the market. He told the publication, "The growth is going to be supported by people at the low end of the cost curve, who have the financial and capital resources to support that growth. We put ourselves certainly in that group."


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