Early in the month, some small lepidolite lithium salt producers halted for maintenance amid losses and less subcontracting. Recycling firms are reducing output due to cost issues, and seasonal dips in salt lake extraction point to a slight drop in December's lithium carbonate production. However, Chile's November exports to China were 13,592 mt, 19% above the yearly average, suggesting December's domestic supply will stay high. Year-end sales targets keep lithium salt companies without strong price support or sales reluctance.
Demand-side weakness in year-end EV, energy storage, 3C digital, and power batteries has battery companies less eager to buy cathode materials, causing ongoing cathode production drops. With EV and energy storage battery cell high inventories and dim demand forecasts, battery cell companies are cutting production to minimize inventory, negatively impacting cathode material manufacturers' production plans.
Domestic lithium carbonate supply is poised to remain in surplus short-term. Cathode producers, reliant on long-term contracts due to order drops, are resistant to current prices. Lithium salt companies that procure lithium ore externally face losses, and battery-grade lithium carbonate prices approach integrated producers' costs, hinting at future cost support. Anticipated production cuts from lithium salt firms may held slow down the decline in lithium carbonate price.
