【SMM Analysis】With the demand recovering, the accumulation of lithium hydroxide inventory in July has narrowed

According to the data, the inventory of lithium hydroxide in the market for July was 47,012 tons, an increase of 4,784 tons compared to the previous month, marking the fourth consecutive month of growth since April of this year. Looking at the inventory structure, by the end of July, the inventory of smelters and the cathode segment increased by 7% and 22% respectively, with the cathode segment accumulating 2,824 tons in the month, which was the main driving force for the total industry inventory to rise. The main reason is that by July, downstream battery cell companies had reduced their backlog of ternary battery cells and material inventory to a relatively low level, and there was a re-stocking action for the cathode extreme, which boosted the market's demand for ternary materials. Some ternary enterprises, under the expansion of orders and their own production scale, and with a strong recovery, have simultaneously started to prepare for the procurement of lithium hydroxide, driving the inventory upward. On the other hand, although the market demand in July has improved, with only a slight decrease in the production arrangement of upstream smelters and the market supply still being excessive, the accumulation of inventory in the smelting link has slowed down significantly, but there is still a slight accumulation of inventory.

Inventory days: As of July 31, 2024, the inventory of upstream smelters was 31,147 tons, with an average of about 30 days, and the inventory of downstream cathode enterprises was 15,865 tons, with an average inventory of about 28 days.