[SMM Lithium Carbonate Daily Review] Battery-grade lithium carbonate spot price fell by 2,600 yuan/mt on October 9, with downstream players remaining cautious after the holiday

SMM Lithium Carbonate Comment on October 9:

Spot Market

On October 9, SMM battery-grade lithium carbonate spot prices were quoted at 119,000-125,700 yuan/mt, with an average price of 122,350 yuan/mt, down 2,600 yuan/mt (-2.08%) from the previous working day. The futures-spot basis stayed high.

In spot trading, downstream buyers remained cautious after the holiday, while some traders showed strong willingness to hold prices firm. The actual traded basis edged up from pre-holiday levels. Demand side, LFP orders were solid, with leading production lines running near full capacity, supporting demand for lithium chemicals.

Futures Market

The most-traded lithium carbonate futures contract (LC2701) opened lower at 117,900 yuan/mt, swung wildly during the day, hitting a high of 121,500 yuan/mt and a low of 115,400 yuan/mt, then weakened into the close at 117,000 yuan/mt, down 4,540 yuan/mt or 3.74% from the previous trading day's settlement price. Trading volume reached 260,500 lots, up 14.4% from yesterday. Open interest rose by 11,960 lots to 421,600 lots. Futures showed a pattern of rising volume and open interest with falling prices. Bears actively entered the market, and the intraday rebound failed to reclaim the previous settlement level. Prices pulled back again near the close, leaving market sentiment weak.

Short-term outlook:

Today's futures decline was notably larger than spot, with futures and spot diverging. The futures market showed growing concerns about mid-term supply recovery and demand sustainability. Meanwhile, spot-side salt producers held prices firm and limited sales, downstream inventory fell sharply, and immediate supply-demand conditions were not loose. The spot premium structure persisted. Short-term lithium carbonate prices are expected to maintain a wide consolidation pattern.