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Lithium prices in China’s domestic market experienced losses over the week to Thursday. Sources attributed the dip to ongoing weak demand and bearish sentiment, which forced lithium producers to make concessions, despite the strength in the spot prices a week earlier.
“There has been minimal spot demand for lithium carbonate. Lithium iron phosphate (LFP) cathode makers have been consistently purchasing spot units on only a hand-to-mouth basis and have been maintaining a low operation rate of 70% at most,” a Chinese lithium producer source said. “When they do restock, it’s ever [30 or 60 tonnes] for each order, which is very small volume.”
The lithium hydroxide market was even more sluggish, with the nickel cobalt manganese (NCM) cathode sector showing even weaker performance than the LFP cathode sector, sources said.
Several Chinese cathode makers told Fastmarkets that they did not purchase any spot units over the week to Thursday citing slow demand recovery in the battery sector amid a “depressing” macro-economic environment.
“There have been no supportive factors in the market that could boost the demand for electric vehicles, and, in turn, lithium demand. The lithium market may remain bearish in the near term,” a Chinese lithium trader said.
The bearish sentiment further constrained the buying appetite among lithium consumers, who expected the lithium prices to continue the downtrend in the near term, market participants said.
Weakness seen in the futures market in the week to Thursday also dampened market sentiment, sources told Fastmarkets.
The most-traded January lithium carbonate futures contract on the Guangzhou Futures Exchange had the saw largest of the week on Monday August 28, with a closing price at 185,700 yuan ($25,553) per tonne, down by 9,800 yuan per tonne from the day’s opening price at 195,500 yuan per tonne.
“Last week, some lithium producers refused to further lower prices due to high production costs. But this week, they are forced to make concessions because demand remains muted and sentiment is still very bearish,” a second Chinese lithium trader said.
Fastmarkets’ weekly price assessment for lithium carbonate, 99.5% Li2CO3 min, battery grade, spot price range exw domestic China was 200,000-210,000 yuan per tonne on Thursday, down by 10,000-20,000 yuan per tonne from 210,000-230,000 yuan per tonne a week earlier.
Fastmarkets’ weekly price assessment for lithium hydroxide monohydrate, LiOH.H2O 56.5% LiOH min, battery grade, spot price range exw domestic China was 190,000-200,000 yuan per tonne on Thursday, down by 10,000-20,000 yuan per tonne from 200,000-220,000 yuan per tonne a week earlier.
Spot lithium prices in the East Asian market also trended downward over the week to Thursday, tracking the downtrend in China’s domestic market, with weak demand exacerbating the downtrend, sources said.
Multiple Chinese lithium producer sources told Fastmarkets that the spot market in East Asia was quiet amid weak demand and that they had only delivered long-term orders during the recent week.
“I think the spot lithium prices may continue falling in the near term, so I am in no rush to purchase spot units now. I will be stay on the side and monitor the market a little longer,” an East Asian consumer source said. “But if I am to purchase spot units, I will try to press prices down further because Chinese lithium producers have ample supply.”
An international lithium producer source added, “Chinese [lithium producers] have more stocks than us, so they need to be more aggressive [when lowering prices].”
Fastmarkets’ daily price assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price cif China, Japan & Korea was $29-31 per kg on Thursday, narrowing down by $2 per kg from $29-33 per kg a day earlier, and down by $3 per kg from $32-34 per kg a week earlier.
Fastmarkets’ daily price assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea was $28-31 per kg on Thursday, down by $1 per kg from $29-32 per kg a day earlier, and down by $2-3 per kg from $30-34 per kg a week earlier.
Spot lithium prices in the United States and Europe continued to post hefty losses across the board in the week ended Thursday August 31, amid a quiet spot market and ongoing bearishness in the more liquid Asian markets, which continued to press prices down.
Fastmarkets last price assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot price ddp Europe and US was $29.50-34.00 per kg on Thursday August 31, down by $2.00-2.50 per kg from $32.00-36.00 per kg a week earlier.
Fastmarkets latest price assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price ddp Europe and US was $31.00-34.50 per kg on Thursday, down by $1.50-2.00 per kg from $33.00-36.00 per kg a week earlier.
Spot prices for lithium technical grade equivalent also moved lower in the week to Thursday, in line with bearish sentiment in Asia. Distributors active in Europe indicated that buyers have still begun to restock following the end of the summer holiday period.
Nonetheless, the lithium hydroxide spot price continue to maintain a marginal premium to the carbonate price due to a tighter market in Europe for hydroxide and smaller volumes requested that usually command a premium, sources said.
Keep up to date with all the lithium price changes and data on our dedicated lithium price page.