【SMM Analysis】In September, domestic total production of lithium carbonate decreased by 6% MoM and was up 38% YoY.

According to SMM statistics, in September, domestic lithium carbonate total production continued to fluctuate at highs, down 6% MoM, up 38% YoY. By raw material, lithium carbonate total production from spodumene decreased 3% MoM. Most spodumene-based lithium chemical smelters maintained high and stable operating rates in September to fulfill long-term contracts and protect market share, while non-integrated smelters kept low operating rates due to cost issues. Additionally, some smelters experienced reduced production due to production line maintenance, leading to a decrease in spodumene-based lithium carbonate production. Lepidolite-based lithium carbonate total production decreased 22% MoM, with frequent reports of production cuts in Jiangxi. Confirmed significant reductions at major smelters in the region, while other non-integrated smelters maintained low operating rates, resulting in a notable decrease in lepidolite-based production. Salt lake-based lithium carbonate total production decreased 5% MoM due to weather impacts reducing operating rates. In contrast, recycled lithium carbonate total production saw a rare increase, up 21% MoM, mainly driven by increased orders for processing waste batteries from a battery maker, boosting production at recycling smelters.

Entering October, driven by continued strong downstream demand, some lithium chemical smelters' production schedules are expected to increase slightly. Additionally, some smelters plan to switch from hydrogen to carbon production, so domestic lithium carbonate total production is expected to rise slightly, with an anticipated increase of 1%-2% MoM.

In the current lithium carbonate spot market, apart from some material factories facing raw material shortages due to reduced customer supply and restocking as needed, other factories have stable long-term orders, limiting the increase in spot demand. Upstream smelters maintain strong price-support sentiment. Given this supply-demand situation and the current high inventory levels, lithium carbonate spot prices are expected to have room for a slight increase, showing range-bound fluctuations.