【SMM analysis】April Lithium Recycling Dip: Hydromet Stockpiling & Falling Salt Prices

SMM News, May 8:

According to comprehensive data analysis, market procurement in April 2025 showed a decline compared to March 2025. As of April 2025, the total recycling volume (black powder basis) in the SMM recycling market reached 24,572 tons, reflecting a month-on-month decrease of approximately 5.0%, while remaining largely flat year-on-year.

On the demand side, downstream battery production for power and energy storage applications continued to grow steadily. However, due to inventory stockpiling and aggressive procurement in March, many hydrometallurgical plants received substantial volumes of scrap materials ordered in March but delivered in April, leading to excess inventory. This has prompted recycling enterprises to prioritize inventory reduction and adopt a more cautious approach toward scrap procurement. Meanwhile, lithium carbonate prices continued to decline in April, while nickel sulfate and cobalt sulfate prices remained stable. Despite this, suppliers such as powder processors and battery cell manufacturers maintained strong price resistance. The delayed downward adjustment of lithium salt prices further exacerbated cost-profit inversion for hydrometallurgical plants, particularly those processing lithium iron phosphate (LFP). Some LFP hydrometallurgical plants opted for production cuts and maintenance due to sustained losses, resulting in reduced procurement and output.

From a materials perspective, cobalt sulfate prices initially surged due to export restrictions in the Democratic Republic of Congo but stabilized by early April. Lithium carbonate prices continued to decline from April to early May. Market transactions became notably subdued in mid-to-late April compared to the previous month, with buyers adopting need-based procurement strategies and showing no signs of the pre-May Day holiday stockpiling activity seen in previous years. Amid current supply-demand imbalances, many powder processors and hydrometallurgical plants are closely monitoring policy developments such as U.S. tariff hikes, trade-in programs, and draft policies on black powder import/export regulations. Market prices and recycling volumes in May are expected to fluctuate in response to policy changes and downstream demand dynamics.