[SMM Analysis] weak Lithium hydroxide Market Price pressure on orders of High Nickel Ternary Materials

SMM4 January 1: according to SMM April 1 latest quotation shows, battery grade lithium hydroxide (coarse particles) quoted 5.3-59000 yuan / ton, the average price of 56000 yuan / ton, stable with last week's price.

From the supply side, lithium hydroxide in the Chinese market is mainly exported to Japan and South Korea, with an average monthly export ratio of about 55-60%. The domestic market demand is relatively concentrated in large ternary material enterprises. At present, there are no more than five lithium hydroxide suppliers approved for use in the battery industry. In March, the overall operating rate of lithium hydroxide manufacturers in China has gradually returned to more than 60%. Producers raised prices in February due to reduced inventories and higher transport costs, but lower orders for downstream high-nickel ternary materials and batteries, a sharp decline in the willingness of buyers to purchase, and lithium hydroxide prices under pressure.

According to SMM, in addition to extreme high nickel ternary material manufacturers operating rate of about 60%, the market generally maintains a low operating rate. Although the direct consumption areas are relatively small affected by the epidemic, but terminal car consumption is concentrated in the European and American markets, the current epidemic spread makes lithium hydroxide export orders also show signs of decline. In order to control the cost, some domestic manufacturers using lithium hydroxide to produce 6-series ternary materials have also begun to use lithium carbonate for production, and the market demand for lithium hydroxide is further reduced.

At present, the price difference between battery grade lithium carbonate and battery grade lithium hydroxide (coarse particles) in China is maintained at about 0.81000 yuan / ton. Some lithium carbonate enterprises originally planned to increase and spread lithium hydroxide production capacity from the end of 2018 to the beginning of 2019. Due to the development of new energy vehicles is not as expected, superimposed lithium hydroxide production technology threshold and downstream enterprise verification cycle and other factors, each enterprise production plan has varying degrees of delay. Taken together, the production capacity of lithium hydroxide is growing slowly in the short term, and the price gap between lithium carbonate and lithium hydroxide is expected to continue.