The lower price will drag down the December’s half-year price by 8% to $12,470 per tonne from the price achieved in the June half.
Orocobre blamed soft market conditions in the China as the main factor behind the lower contract prices, adding that that "there was also an indirect impact as a number of customers outside China have downstream exposure to the Chinese market [and are] experiencing market and commercial pressure."
Fastmarkets' Chinese domestic battery-grade lithium carbonate spot market price fell 54.9% in the year to 75,000-83,000 ($10,889-12,050) yuan per tonne on Thursday December 13, from 180,000-170,000 yuan per tonne on November 30, 2017.
The technical and industrial grade lithium carbonate spot price in China has also slumped by 56% to 68,000-75,000 yuan per tonne on December 13, from 160,000-165,000 yuan per tonne on December 14, 2017.
Slower spot consumption year on year due to a change in the Chinese new energy vehicles (NEV) subsidy policy, cheaper material sold in China over the course of 2018 and a soft surplus of supply have pushed down Chinese spot market prices this year.
This fall in Chinese domestic prices has had a direct effect on contract prices in the rest of the world. Contract prices have softened month on month throughout the fourth quarter of 2018, Fastmarkets reported earlier.
Orocobre sold 2,850 tonnes of lithium carbonate in December quarter. The company expects to sell 5,000 tonnes of lithium carbonate and produce 6,000 tonnes of lithium carbonate in the December half, within the previous guidance for the full year of 2019.
Argentina-based lithium producer Orocobre Ltd estimates the company's short-term contract prices in the December quarter will be $10,800 per tonne on a fob Argentina basis, 26.52% lower from $14,699 per tonne in the previous quarter.