【SMM Analysis]】A Review of This Week's Lithium Carbonate Price Trends (2024.07.29-2024.08.02)

This week (2024.07.29-2024.08.02), the spot price of lithium carbonate dropped significantly. The SMM battery-grade lithium carbonate index price fell from 84,130 yuan/mt to 80,705 yuan/mt, a decrease of 3,425 yuan/mt. The low-end price of battery-grade lithium carbonate dropped from 82,400 yuan/mt to 79,000 yuan/mt, and the high-end price fell from 86,100 yuan/mt to 82,600 yuan/mt. The average price decreased from 84,250 yuan/mt to 80,800 yuan/mt, a drop of 3,450 yuan/mt. The low-end price of industrial-grade lithium carbonate fell from 78,500 yuan/mt to 75,300 yuan/mt, the high-end price dropped from 80,100 yuan/mt to 76,400 yuan/mt, and the average price decreased from 79,300 yuan/mt to 75,850 yuan/mt, a drop of 3,450 yuan/mt.

This week, the focus of transaction prices in the lithium carbonate spot market continued to shift downward. The inquiry behavior of material plants increased slightly from a week ago, but the overall market transaction situation remained inactive. Supply side, lithium salt plants, considering their production costs, still had a strong sentiment to hold prices. Some lithium salt plants, worried about the price outlook, had a destocking sentiment and slightly lowered their quotations. On the other hand, demand side, material plants preferred to trade close to market prices, resulting in a certain gap in the psychological expected transaction prices between upstream and downstream.

Currently, material plants, with long-term orders and customer-supplied quantities meeting their basic production needs, have limited rigid demand for lithium carbonate. The cold trading sentiment, together with the oversupply pattern, has caused lithium carbonate prices to continue to decline, with inventory pressure gradually emerging. Traders, in this situation, actively destocked and rarely made purchases.

Considering that the oversupply situation of lithium carbonate is unlikely to be reversed or alleviated in the short term, it is expected that lithium carbonate prices will continue to run weakly. The adjustment of the supply-demand relationship will take time!