China’s Yahua commissioned 20,000 mt lithium hydroxide project

Tianqi Lithium's share prices had surged from April 2020 amid development of new energy vehicles (NEVs), but dropped rapidly after the Chinese New Year (CNY) holiday. 

Battery-grade lithium hydroxide prices in China have been falling since the start of H2 on stable demand but rising supply, down about 12% from early 2020. Compared with lithium carbonate, lithium hydroxide prices remained above cost lines, but some lithium salts producers are pessimistic about battery-grade lithium hydroxide prices in 2020.

Ganfeng Lithium, a top lithium producer in China, has said it is stepping up efforts to construct a lithium hydroxide expansion project, with an annualised capacity of 50,000 mt, to catch up with the schedule delayed by the coronavirus outbreak. The project is slated to come online in Q4 this year.

Phase-one project is designed with an annualised capacity of 15,000 mt of lithium hydroxide and 10,000 mt of lithium carbonate. Full operation of the second phase of the project is expected to bring about an output value of 3.3 billion yuan per year. 

The widespread coronavirus has deterred production of NEVs in the European countries, and this may impact the global prospects for NEV production and take a toll on the consumption of raw materials. Last week, bearish sentiment continued to prevail in the cobalt market, which depressed downstream purchases and added to upstream inventory pressure. Sluggish demand reduced prices of battery-grade lithium carbonate, which were underpinned by costs, while fundamentals supported prices of industrial-grade lithium carbonate. 

Japan’s Panasonic and PEVE, South Korea’s LG Chem, Samsung SDI and SKI were among the world’s top 10 EV battery producers in terms of shipments in 2019, according to data from SNE. The two countries are also home to many cathode materials producers.

Industrial activity levels outside of central China continues to improve as workers return from quarantine periods and logistics pressures eased.

Stable demand from battery anode will cap the decline in lithium salt prices

Prices of lithium hydroxide could face further downward pressure in the short term

Cobalt, lithium prices may remain under pressure from excessive supplies in H2