[SMM Analysis] In January 2025, SMM's total domestic lithium carbonate production decreased 10% MoM, up 50% YoY.

In January 2025, SMM's total domestic lithium carbonate production showed a downward trend, down 10% MoM and up 50% YoY. At month-end, the Chinese New Year holiday arrived, and some lithium chemical plants had production cut plans due to maintenance, leading to a significant reduction in total lithium carbonate production this month. By raw material type, lithium carbonate derived from spodumene saw a 17% MoM decrease in total production in January. Some lithium chemical plants experienced a decline in output due to reduced orders under tolling agreements, while others initiated production line maintenance with relatively long maintenance cycles. Overall, the reduction in lithium carbonate derived from spodumene was significant. Lithium carbonate derived from lepidolite showed relatively stable total production MoM, remaining nearly flat. Given the relatively low overall operating rate of lepidolite smelters, production was mainly concentrated in leading integrated lepidolite smelters, whose output remained relatively stable with no clear maintenance plans. Non-integrated lithium chemical plants had relatively small production volumes, resulting in limited reductions. Overall, lithium carbonate derived from lepidolite operated in a relatively stable manner. Lithium carbonate derived from salt lake increased 2% MoM in total production, primarily driven by the resumption of production after production line upgrades at a certain lithium chemical plant. Other lithium chemical plants maintained relatively stable production at low levels due to the low winter temperatures. Overall, the fluctuation in lithium carbonate derived from salt lake was relatively small. Lithium carbonate from recycling decreased 11% MoM in total production, as some recycling-end lithium chemical plants had maintenance and production cut plans in January. Additionally, with relatively high raw material costs, production motivation was insufficient, leading to a significant reduction in total output of lithium carbonate from recycling. In February, as some lithium chemical plants remain in maintenance cycles, subsequent production recovery will involve start production and production line adjustments. Combined with February having only 28 calendar days, SMM expects total domestic lithium carbonate production to continue its downward trend, with an estimated 5% MoM decrease.