[SMM Analysis] Lithium Carbonate leading Enterprises' net profit soared in the third quarter and Lithium Carbonate prices may remain stable in November.

SMM11, March 18: according to SMM research, the price of battery-grade lithium carbonate has shown an overall upward trend since the end of August. as of today, the average daily price of battery-grade lithium carbonate is 43000 yuan / ton, rebounding 8.2% from the lowest level of 39750 yuan / ton since the beginning of the year.

Since the beginning of July, the price of industrial-grade lithium carbonate has bottomed out and rebounded. As of today, the average daily price of industrial-grade lithium carbonate is 38250 yuan per ton, rebounding 11.7 percent from the lowest level of 34250 yuan per ton since the beginning of the year.

"Click to view the historical price of SMM cobalt lithium

The rebound in the price of lithium carbonate has led to an increase in corporate profits to a certain extent. Recently, many leading lithium carbonate companies have announced their third-quarter results. For example, the third-quarter net profit of Shengxin Lithium Energy has soared by 1071.4% compared with the same period last year.

The operating income of Ganfeng Lithium Industry in the third quarter was 1.506 billion yuan, up 8.5% from the same period last year; the net profit belonging to shareholders of listed companies was 174 million yuan, up 421.32% from the same period last year.

Earlier, it was reported that Ganfeng Lithium had exercised its option to increase its stake in its Mexican Sonora project from 22.5% to 50%, at a cost of 23 million pounds ($30 million). It is reported that if the financing of the Sonora project is completed, it will be put into production in 2023. According to the Ganfeng Lithium Industry announcement, the Sonora project is a lithium clay lithium extraction project located in Mexico and is currently one of the largest lithium resource projects in the world. The total lithium resource of the project is about 8.8 million tons of lithium carbonate equivalent. It is estimated that the annual production capacity of lithium hydroxide after the first phase of the project is put into production is 20000 tons.

Ganfeng Lithium Industry to increase its holdings of Mexico Sonora Project is scheduled to be put into production in 2023

The operating income of Yongxing material in the third quarter was 1.403 billion yuan, an increase of 15.41% over the same period last year, while the net profit belonging to shareholders of listed companies was 90.71 million yuan, down 5.97% from the same period last year.

Yongxing material has said that the company's lithium electricity new energy sales are good, the average monthly output has exceeded 900 tons, and now the monthly production of lithium carbonate exceeds demand. The main customers are Xiamen Tungsten New Energy, Hunan Yuneng, CITIC Big Manganese, CITIC Guoan Gu Li and so on, all of which are the leading enterprises in various fields. In addition, the certification work of Cunninghamia lanceolata, Dangsheng Technology, long-term Lithium, Guoxuan Hi-Tech and other companies is already in progress.

Yongxing material: lithium electricity new energy business sells well, with an average monthly output of more than 900 tons.

The operating income of Yahua Group in the third quarter was 920 million yuan, an increase of 16.08% over the same period last year. The net profit belonging to shareholders of listed companies was 62.42 million yuan, a year-on-year increase of 611.73%.

Shengxin LiNeng's operating income in the third quarter was 730 million yuan, up 11.54% from the same period last year, and the net profit attributed to shareholders of listed companies was 220 million yuan, up 1071.4% from the same period last year.

Recently, Galaxy Resources signed a three-year agreement with Sichuan Shengtun Lithium Industry Co., Ltd., a wholly owned subsidiary of Shengxin Lithium Energy. Sheng Xin LiNeng has agreed to buy at least 60,000 tons of spodumene concentrate from Catlin Mountain each year. The deal will begin in January 2021 and continue through 2022 and 2023, when up to 180000 tons will be purchased and purchased from the Catlin Hill mine.

[concern] Galaxy Resources and new customer Shengxin LiNeng signed a multi-year off-take agreement.

Overall, the net profit of most lithium carbonate companies soared in the third quarter compared with the same period last year. SMM believes that the price of lithium carbonate gradually rebounded in August. Due to the impact of the epidemic this year, the inventory pressure of domestic lithium salt factories was greater in the first half of the year, and the price sank. With the gradual warming of consumer demand in the post-epidemic era, the new energy vehicle terminal transmits the recovery emotion to the upstream. Since June, the domestic demand for lithium carbonate for cathode materials has become positive compared with the same period last year, with an average monthly growth rate of 10%. Up to now, the market price of battery-grade lithium carbonate in China is 4.1-45000 yuan / ton, and that of industrial-grade lithium carbonate is 3.7-39500 yuan / ton.

In the fourth quarter, the production reduction in Qinghai is larger than that in Sichuan and Jiangxi, the supply of industrial carbon continues to be tight, the sales of some manufacturers exceed production, gradually clear the inventory, the superimposed demand continues to rise, and the price of industrial carbon still has a upward trend. In terms of electric carbon, the quotations of the major lithium salt companies are basically adjusted to 4. 4-45000 yuan / ton, and the spot volume of some manufacturers is less, and the transaction is sporadic. According to SMM research, the recent downstream demand for electric carbon procurement slowed down, lithium cobalt and ternary materials demand for lithium carbonate decreased month-on-month in November, spot purchasing sentiment gradually stabilized, prices are expected to stabilize.