Growing supply could pressure lithium carbonate prices

Lithium carbonate prices fell in the week ending March 28. Most smelters had gradually returned to normal production in early March after completing maintenance, allowing the weekly output to recover to levels seen around November 2023. Some smelters adopted a less firm pricing stance since production is now profitable in theory. Chilean exports have recently arrived in China, with more on the way. These have increased supply in the domestic spot market and the supply crunch could be fundamentally solved in the future, weighing down spot prices, and future price outlook remains bearish. Some smelters refused to compromise on prices, though. While the recent lithium ore price hikes by miners is not quite welcomed by most smelters, the bidding results of Albemarle and some other miners indicate that expensive ore is still acceptable to some buyers, thus the support to lithium carbonate prices remains. We expect smaller volatility in lithium carbonate prices going forward.