SHANGHAI, Jun 17 (SMM) - The average monthly price of battery-grade lithium carbonate was 461,657 yuan/mt in May, down 5% MoM. The prices are expected to rise in June on the backdrop of growing demand.
At the beginning of the month, the supply gradually rose due to the release of new production capacity. On the demand side, the production schedule of LFP material manufacturers improved slightly, while the remaining materials’ production remained low, hence the overall demand picked up slightly. The prices of lithium carbonate remained stable.
In the middle of the month, the supply side stabilised, and the upstream players held firm to the prices. Some manufacturers received more inquiries and saw more active downstream sentiment, which, coupled with rising ore auction prices that increased the uncertainties concerning the cost and market outlook, prompted them to firm the prices. In terms of downstream manufacturers, most of the signs of improvement in demand were not realised yet, and the purchases of lithium salt were also cautious. The prices fell slightly on signs of oversupply.
At the end of the month, the supply side remained stable. Small and medium-sized factories and traders actively sold off when the prices fell before. As such, their inventory dropped to a low level, and held back cargoes in light of warming demand. The new LFP capacity also generated more demand for industrial-grade and quasi battery-grade lithium carbonate, and some small and medium-sized factories purchased on rigid demand, quickly consuming most of the low-priced sources in the market, in which case the low-end prices rose more rapidly.
The monthly average price of battery-grade lithium hydroxide in May was 467,815 yuan/mt, down 3% from the previous month. The prices are likely to rise slightly in June driven by the hike of lithium carbonate prices.
At the beginning of the month, lithium hydroxide prices dropped slightly. The supply rose steadily as the new capacities smoothly ramped up the production. On the demand side, some battery factories still reduced their inventories of high-nickel NMC products, while some material manufacturers were relatively optimistic about the demand for high-nickel materials in June, hence market activities improved slightly. But the actual transactions were still muted.
In the middle of the month, the supply rose slightly this month. The demand side, however, showed completely different trends in China and overseas. Due to weak demand and lack of obvious demand recovery signal, downstream material factories had few inquiries and sluggish purchase intentions for lithium hydroxide, and the prices dropped slightly.
At the end of the month, the supply increased to some extent, but the demand side did not improve, and the market maintained the situation of small oversupply. The market was still quiet as a whole, and the mainstream manufacturers were still not willing to sell at low prices due to the strong overseas market. Some of the small and medium-sized factories that mainly engage in domestic trade, on the other hand, were more willing to sell with lower prices. Most downstream material factories were still pessimistic about the demand prospect, hence focused on long-term orders and adopted caustic processing to supplement the raw material stocks and control the cost. The overall market stalemate remained, and the prices stood stable.
China’s output of battery-grade lithium carbonate stood at around 15,918 mt in May, a month-on-month increase of 1% and year-on-year increase of 19%. In May, smelters that reply on spodumene, lepidolite and brine lakes underwent maintenance in turn, and the overall production remained stable. However, due to the rapid decline in the prices of industrial-grade lithium carbonate, the production of purification process increased slightly. The production capacity of some lepidolite-based smelters has been released entering June, and the supply will increase slightly. At the same time, driven by the recovery of demand, the output of purification manufacturers will also rise. China’s battery-grade lithium carbonate output is expected to stand at 16,793 mt in June, up 5% MoM.
On the demand side, domestic demand for battery-grade lithium carbonate rose 5% MoM and 27% YoY in May. In terms of NMC materials, orders in May ran at a low level, and the output of medium and low-nickel materials increased minimally. LCO was still in the off-season, and the demand changed little. For LFP, with the improvement of the pandemic situation, terminal demand and battery production have gradually recovered, hence the LFP demand bottomed out, heightening the consumption of lithium carbonate by about 10% MoM. The LCO market has been relatively stable entering June. The power market, on the other hand, continues to pick up in the post-pandemic stage, and the demand for LFP is expected to remain high. In addition, some new LFP plants are about to be put into operation soon, and the NMC sector has also recovered with the power battery market. The overall demand for battery-grade lithium carbonate rises palpably. It is expected that overall battery-grade lithium carbonate demand may increase slightly by 17% MoM in June.
In terms of import and export, after the pandemic was brought under control, some of the lithium carbonate piled up at the port entered the domestic market. The import volume in May is estimated to have increased significantly compared with April, and the situation of oversupply is likely to aggravate in the short term. In June, with the resumption of customs operation and the logistics, as well as the rising overseas supply of lithium carbonate, the import value may remain high.
China’s industrial-grade lithium carbonate output stood at 14,973 mt in May, a month-on-month increase of 20% and year-on-year increase of 57%. The output grew significantly partly because the production in Qinghai province has gradually approached its peak, and some lepidolite-based manufacturers recovered from maintenance, while new production capacity was also put into production. The newly added capacity of some manufacturers has continued to increase the production entering June, and the production in Qinghai has peaked. The overall industrial-grade lithium carbonate output is expected to rise further based on that in May. China’s industrial-grade lithium carbonate output is expected to stand at 15,982 mt in June, up 7% MoM.
On the demand side, industrial-grade lithium carbonate demand increased by 22% month-on-month in May. In terms of LFP, the outsourcing demand of LFP manufacturers rose palpably after the power battery market recovered significantly after the pandemic situation improves. For LMO, the downstream demand recovered slightly after a small hike in lithium prices in late May, followed by a slight increase in purchasing demand compared with April. Due to the aggressive production schedules of LFP materials amid rising terminal demand, it is expected that the total demand for industrial-grade lithium carbonate will rise by another 19% in June.
![[SMM 에너지저장 배터리 셀 시장 주간 리뷰 9.3] 동박 공급 부족으로 9월 생산 일정 제약, 에너지저장 배터리 셀 가격 견조 유지](https://imgqn.smm.cn/usercenter/tKgKv20251217171725.png)
![Lithium Carbonate Market Weekly Review: 8.31-9.3 spot lithium carbonate prices rose first then fell, overall downward trend [SMM Weekly Review]](https://imgqn.smm.cn/usercenter/PPLUj20251217171727.jpg)
