[SMM Analysis] Lithium hydroxide production in February continued to weaken, down less than 5% MoM.

According to SMM, this month's lithium hydroxide production, affected by the Chinese New Year holiday and maintenance, reached a recent low, with a decline of approximately 4%, up 15% YoY. Raw material side, smelting output decreased by about 5%, up 21% YoY. This month's production was impacted by holiday-related maintenance and shutdowns during the Chinese New Year, leading to fewer production days. Additionally, post-holiday demand orders rebounded less than expected, causing some producers to maintain relatively low production levels. The smelting side continued its previous trend of reduced output. On the causticisation side, operating rates remained persistently low, with a relatively small production base. However, with some companies' new production lines gradually ramping up, production saw a slight increase, though its contribution to overall supply was minimal. In March, as most companies complete maintenance and production schedules normalize, lithium hydroxide production is expected to rebound, with growth exceeding 25%. However, due to weak demand growth, producers are shifting lithium-to-carbonate production lines, resulting in overall production falling short of last year's levels, down 5% YoY.