GLOBAL LITHIUM WRAP: China’s carbonate market accelerates decline in December on downbeat sentiment

The pace of decline in the Chinese domestic battery grade lithium carbonate price has accelerated entering December with increasingly lower offer prices in the spot market from Chinese producers eager to destock in the week ended Thursday December 5.

  • China’s battery grade lithium carbonate price downtrend has accelerated due to lower spot offer prices and sporadic downstream buying.
  • The technical and industrial grade lithium carbonate price lurched lower on shrinking demand.
  • Chinese battery grade lithium hydroxide price softened on a lack of buying.
  • Seaborne Asian lithium market remained subdued at current levels.
  • European and US price quiet with no changes in sight in December.

The domestic Chinese battery grade lithium carbonate spot price fell below 50,000 yuan ($7,097) per tonne on the low end of the range in the first week of December. Continuously weak demand from downstream cathode makers brought more pressure on the lithium market, pushing more producers to lower their offer prices to boost sales near year-end.
Fastmarkets assessed the lithium carbonate, 99.5% Li2CO3 min, battery grade, exw domestic China, spot price at 48,000-53,000 yuan per tonne on Thursday, down from 52,000-55,000 yuan per tonne in the previous week.

“Lower offer prices of below 50,000 yuan per tonne are seen this week for battery-grade carbonate with some producers adjusting prices for December, mainly for materials produced from mica. While most carbonate produced from spodumene are still at 51,000-53,000 yuan per tonne for the moment,” a producer told Fastmarkets.

“We haven’t purchased any materials as we have no immediate needs and still have stocks on hand. As more producers will be eager to boost cash flow near the year-end, I think prices will be in a mess in the whole December with even lower prices reported later,” a buyer said.

The price fell by 5.6% week on week in the latest assessment, steeper than the average weekly fall of 2% over November.

Reducing demand from lithium manganese oxide (LMO) and lithium iron phosphate (LFP) battery manufacturers has also put pressure on the technical and industrial grade lithium carbonate market, bringing lower prices this week.

Fastmarkets assessed the Chinese technical and industrial grade lithium carbonate spot price at 41,000-44,000 yuan per tonne on Thursday, down from 43,000-47,000 yuan per tonne a week ago.

The Chinese domestic battery-grade lithium hydroxide price continued its decline with no recovery from the high-nickel ternary sector, and short-term market sentiment remains negative, according to market sources.

Fastmarkets assessed the lithium hydroxide monohydrate, 56.5% LiOH.H2O min, battery grade, exw, spot price at 52,000-57,000 yuan per tonne on Thursday, down from 53,000-58,000 yuan per tonne previously.

Asian lithium seaborne price rangebound
The seaborne cif China, Japan and South Korea battery-grade lithium spot market consolidated the previous week’s losses, while spot buying remained thin with most market participants negotiating 2020 contracts.

Fastmarkets’ lithium carbonate, 99.5% Li2CO3 min, battery-grade cif China, Japan and Korea spot price stood at $8.50-10 per kg on Thursday, unchanged from the previous week.

The lithium hydroxide monohydrate, 56.5% LiOH.H2O min, battery-grade cif China, Japan and Korea spot price held at $10.50-12 per kg on the same day.

“Seaborne cif Japan prices are mostly the same as last week, but as China’s prices keep falling, I feel the seaborne prices will be at a low level in December as well,” a distributor told Fastmarkets.

European, US consumers said to be covered for the rest of 2019
European and United States’ battery-grade lithium carbonate and hydroxide spot prices remained steady during the week. A number of consumers were reportedly covered for December 2019 and some reported having sufficient material for January 2020.

The lithium carbonate 99.5% Li2CO3 min, battery grade, spot price ddp Europe and US stood at $10-12.50 per kg, unchanged this week on thin spot liquidity.

Meanwhile, the lithium hydroxide monohydrate 56.5% LiOH.H2O min, battery grade, spot price ddp Europe and US remained also steady during the week, with prices at $12.50-13.50 per kg on Thursday.

Spot activity was very thin and most consumers have confirmed that their spot purchases for the year are finalized. For their part, producers and traders have noticed a cautious sentiment due to the uncertain outlook for lithium prices in the near term.

“I do not necessary see a soft market in terms of demand but consumers are cautious, they will not commit to big volumes,” a European lithium carbonate trader said. “Prices in China continue to fall and therefore consumers do not want to commit… Some of them also tried to bargain the price in previous weeks but I haven’t sold anything below the published range,” he added.

Learn more about Fastmarkets’ lithium pricing methodology here and read the latest lithium price spotlight here.

Fastmarkets’ trade log for battery-grade lithium carbonate in China for December includes all trades, bids and offers reported to Fastmarkets.

All lithium carbonate, hydroxide and spodumene prices are available in our Battery Raw Materials Market Tracker. Get a sample of the report here.

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