[SMM Analysis] The First Weekly Market of Lithium Hydroxide in 2025

This week, lithium hydroxide continued its slight upward trend. On the production side, as the Chinese New Year approaches, factors such as transportation and the holiday have led to a reduction in production days for some lithium chemical plants, resulting in a MoM decrease in output. On the market side, the supply side saw lithium chemical plants maintain their previous sentiment to stand firm on quotes, keeping prices at high levels. On the demand side, most ternary cathode material plants had engaged in some stockpiling earlier, leading to limited demand this week and a decrease in the frequency of spot order purchases. Market transactions were mostly limited to just-in-time procurement, with few large-volume deals. Additionally, regarding long-term contracts for the new year, downstream acceptance of discounts has improved to some extent following upstream price hikes over the past month or so. Some lithium chemical plants, considering factors such as inventory, are expected to adopt a more flexible stance. Overall, long-term contract discounts are expected to increase YoY compared to 2024, with shorter contract durations.

In the short term, lithium hydroxide prices are expected to rise under the continued sentiment to stand firm on quotes from the supply side, but the upside room is limited due to weak demand.