Cathode Material Enterprises Received Less Orders in April

SHANGHAI, Apr 7 (SMM) - According to SMM prices, lithium salt prices, led by lithium carbonate and lithium hydroxide, continued to climb in the first two months of 2022. As of March 31, domestic battery-grade lithium carbonate rose from 278,000 yuan per tonne at the beginning of the year to 502,500 yuan per tonne, an increase of 80.76%. Battery-grade lithium hydroxide rose from 222,500 yuan per tonne at the beginning of the year to 491,500 yuan per tonne on March 31, an increase of 120.9% during this period.

Under the rapid rise in lithium salt prices, the Ministry of Industry and Information Technology and other parts have embarked on ensuring supply and stabilising prices. And coupled with the recent increase in supply and weak performance on the demand side, lithium carbonate prices tend to level off and even see a slight downward correction.

Specifically, according to SMM latest research, the supply of lithium carbonate continues to ramp up, while the demand side posts no surprises. And the downstream is still in the game with the upstream. Previously, the prices offered by traders dropped lower, and some material plants have lowered their prices to sell off raw material stocks. While the transaction volume was still low, the market prices also dropped.

Ternary precursor prices were unchanged this week. Cobalt salt prices were slightly lower, and nickel salt prices were stable; precursor costs fell slightly. Recently, April precursor long-term orders are being delivered, but the pricing mechanism is still not settled.

The recent downstream consumer market has been very quiet, and many small and medium-sized precursor enterprises are considering reducing or even stopping the production in April. Ternary material prices are stable.

On the supply side, the output of high nickel products declined in light of less orders, while low and medium nickel products’ output remained stable. On the demand side, e-bike and electronics saw significant reduction in orders, and power battery demand fell slightly. Nonetheless, supported by the cost, the prices have been stable, which may correct later with falling lithium prices.

Lithium iron phosphate prices are also stable. Some battery companies have lower battery cell stocks as demand from low-end storage, e-bike battery and other sectors weakened, resulting in falling LFP production schedules.

Recently, lithium salt prices fell after the traders sold off. But LFP manufacturers mostly used their lithium carbonate stocks built in early March, and LFP prices stabilise with support from the cost side.

Xiangcai Securities previously issued a research report, said that the rising supply of lithium cannot keep up with the growing demand in 2022, and the imbalance between supply and demand is difficult to ease. Lithium supply is expected to be tight throughout the year, and lithium prices will also remain high.