(Yicai Global) Aug 5 -- A unit of wood panel producer Guangdong Weihua will provide LG Chemical, a part of Korean conglomerate LG, with lithium hydroxide for the next two years, the Shenzhen-based firm said.

Sichuan Zhiyuan Lithium will supply LG Chem, one of the world’s biggest manufacturers of lithium-ion batteries, with 1,500 metric tons of lithium hydroxide by the end of the year, the firm said yesterday, without going into any financial details other than to say that prices will be determined month by month. Next year’s shipment amounts will be decided at year end.

Zhiyuan Lithium, located in Deyang, southwestern Sichuan province, can produce 40,000 tons of lithium salts a year.

LG Chem’s new factory in Nanjing, eastern Jiangsu province started mass production of lithium-ion cells earlier this year.

Guangdong Weihua's share price [SHE:002240], which has more than doubled in the last three months, was trading down 4.10 percent at CNY15.44 (USD2.22) this afternoon.

Editor: Kim Taylor