[SMM Analysis] Production Outlook for the Ternary Cathode Material Market After Chinese New Year

By the first week after the Chinese New Year, as of February 6, the costs and prices of 5-series and 6-series ternary cathode materials showed varying degrees of decline due to the drop in lithium carbonate prices. The costs of 8-series ternary cathode materials remained stable as the prices of lithium hydroxide and sulphuric salts showed no changes.

In terms of production and supply, the production of ternary cathode materials declined overall, affected by the off-season period at the beginning of the year. In January, the overall operating rate of ternary cathode material enterprises was around 37%, showing a further decline compared to December. The traditional off-season in the industry led to an overall decrease in orders for ternary cathode materials, with only a few top-tier enterprises maintaining high production levels from earlier periods. Some ternary cathode material producers, primarily supplying overseas customers, experienced smaller order declines compared to other enterprises. Industry concentration further increased, with mid- and lower-tier enterprises seeing more significant order reductions. Based on the production schedule for February 2025, China's ternary cathode material production is expected to decrease by 9.6% MoM, mainly due to the spring holiday period in February, during which enterprises take breaks and production lines are shut down. Except for a few producers planning to maintain normal production without holidays in February, most manufacturers are expected to see reduced production during the month.