Battery chemicals manufacturer Terrafame announces job cuts
Terrafame is also concerned that the prices for battery chemicals and the raw materials nickel and cobalt, which Terrafame extracts in its own mine, have recently fallen sharply. Terrafame announced that it expects the market for battery chemicals to remain difficult next year. The company will therefore cut costs and reduce its workforce, which totalled 826 employees at the end of September.
According to an initial estimate by the company, the maximum staff reduction would total 75 person-years. Various options are being considered in negotiations with staff, ranging from a switch to part-time work and a change in job descriptions to redundancies.
The difficult market for battery chemicals has recently put pressure on demand for Terrafame’s products and thus on net sales and profitability, says CEO Seppo Voutilainen: “The battery chemicals market in particular has continued to be challenging, which has been reflected in the demand for Terrafame’s products and thereby in our net sales and profitability. At the same time, Terrafame is currently implementing the largest investment programme of its history regarding, among others, the new secondary leaching area needed for bioleaching. To improve the company’s profitability, in early 2024 we initiated a profitability programme aiming for EUR 10 million in annual savings, which has progressed as planned. In spite of the positive development of our cost efficiency, we are now forced to initiate change negotiations due to the continued challenging operating environment.”
Nevertheless, Voutilainen is convinced that Terrafame is still on the right track: “Despite a temporary market downswing, the electrification of mobility is inevitable. Terrafame is a significant part of the European battery value chain, and we believe in the demand for battery chemicals in the longer term. Our strength is the flexible production process, which enables selling our nickel product as an intermediate when the battery chemicals market does not meet the expectations.”
Terrafame was originally founded in 2015 as a state-owned mining company to take over a nickel mine from an insolvent company. Today, however, Terrafame is positioning itself as a battery chemicals manufacturer. To this end, the company opened a plant in 2021 to process nickel cobalt sulphide into nickel sulphate and cobalt sulphate, which are used in the production of lithium-ion batteries. Customers for the nickel sulphate include Stellantis and Renault.
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