[SMM Analysis] Total Domestic Lithium Carbonate Production in December Up 9% MoM, Up 59% YoY

In December, domestic lithium carbonate production continued to rise rapidly, up 9% MoM and up 59% YoY. Driven by strong downstream demand maintaining high production levels and the presence of certain arbitrage opportunities in the futures market, upstream lithium chemical plants showed sustained enthusiasm for production.

By raw material type, lithium carbonate derived from spodumene saw a significant increase in December, up 16% MoM. The growth was partly attributed to increased production at some lithium chemical plants driven by profits in the delivery market and partly to hydrogen-to-carbon conversion and the ramp-up of newly commissioned production lines. Lithium carbonate derived from lepidolite also continued to ramp up, up 12% MoM. The increase was supported not only by sustained growth driven by strong demand but also by additional output from newly resumed smelters. Lithium carbonate derived from salt lake experienced a production decline due to weather impacts, down 14% MoM. Meanwhile, a leading battery cell manufacturer maintained a high level of orders under tolling agreements for recycled batteries, keeping lithium carbonate from recycling stable, up 1% MoM.

Entering January 2025, the traditional Chinese festival—Chinese New Year—is approaching. On one hand, some upstream lithium chemical plants are planning maintenance around the holiday, which is expected to reduce production. On the other hand, downstream demand has shown signs of weakening, which is also affecting the production sentiment of upstream lithium chemical plants. Domestic lithium carbonate production in January 2025 is expected to decrease by 9% MoM.