GLOBAL LITHIUM WRAP: Hydroxide prices post gains on supply constraints
The global lithium hydroxide complex extended its firm tone over the week ended Thursday June 17 against a backdrop of persistent supply constraints and optimism for growing demand.
- Battery-grade lithium hydroxide prices in both the domestic Chinese and seaborne Asian markets rallied because consumers are still finding it difficult to secure adequate feedstock.
- Battery-grade lithium carbonate suppliers in China’s domestic market held offers steady, supporting the price at current levels.
- Europe, US lithium spot complex continued upward trajectory on tight supply and global uptrend.
The battery-grade lithium hydroxide spot price in the seaborne Asian market jumped after suppliers succeeded in translating previous offer hikes into business.
Fastmarkets’ weekly assessment for the lithium hydroxide monohydrate 56.5% LiOH.H2O min, battery grade, spot price cif China, Japan & Korea rose to $14-16 per kg on Thursday, up by 9.09% from $13.00-14.50 per kg one week ago.
Business was concluded close to the high end of the range while aggressive offers dominated the spot market in light of spot tightness and strong momentum in China.
Some consumers are less likely to surrender to high offers since they are sitting comfortably on supply agreed in long-term contracts, while some newcomers in the region have concern about security of units and are therefore more willing to accept high offers, a distributor said.
The spot price has also rallied because of broad market expectation that contractual prices for the third quarter to rise notably from the second quarter.
“Some suppliers cut volumes for the third quarter, and raised [spot] offer prices,” a trader said.
Fastmarkets’ weekly assessment for the lithium hydroxide monohydrate, 56.5% LiOH.H2O min, battery grade, spot price range, exw domestic China rose to 95,000-98,000 yuan ($14,734-15,199) per tonne on June 17, up by 1.58% from 92,500-97,500 yuan per tonne previously.
Consumers in China are still struggling to secure units at the moment while demand is ramping up at unexpected speed, market participants told Fastmarkets.
“Pressure to secure feedstock will grow since demand is increasing too quickly,” a producer said.
“Demand for lithium hydroxide will remain robust with overseas automotive manufacturers accelerating their ramp-up plans,” a consumer said.
In addition, a leading lithium hydroxide producer in China is putting some facilities under care and maintenance in the second half of June, which is expected to further add to the tight spot availability, a source close to the matter told Fastmarkets.
The same source also noted with the maintenance, the producer is likely to use up its stockpiled inventories in June-July to fulfil its contractual commitments.
In the lithium carbonate complex in Asia, prices were firm, especially in the seaborne Asian market where buyers have to battle with a shortage of supply.
Fastmarkets’ weekly price assessment for lithium carbonate, 99.5% Li2CO3 min, battery grade, spot price, cif China, Japan and Korea rose to $13-14 per kg on June 17, up by 3.85% from $12-14 per kg one week ago.
Fastmarkets assessed the lithium carbonate 99.5% Li2CO3 min, battery grade, spot price range exw domestic China as unchanged week on week at 87,000-89,000 yuan per tonne on the same day.
Despite a seasonal increase in production of lithium carbonate in Qinghai province, active production of lithium iron phosphate (LFP) batteries, which mainly feed on lithium carbonate, buoyed sentiment to some extent.
Europe, US lithium spot complex underpinned by global price trends
Spot lithium prices in Europe and the United States continued to move up, thanks to support from tight availability of technical-grade compounds, ongoing logistic disruptions and an upward price trend in global lithium prices, sources said.
Fastmarkets’ weekly price assessment for lithium carbonate 99.5% Li2CO3 min, battery grade, spot price ddp Europe and US stood at $13.50-15.00 per kg on Thursday, up 3.64% week on week from $13.00-14.50 per kg.
Fastmarkets’ assessment for lithium hydroxide monohydrate 56.5% LiOH.H2O min, battery grade, spot price ddp Europe and US stood at $14.50-16.00 per kg on Thursday June 17, up 1.67% week on week from $14.50-15.50 per kg.
“I see still a premium on Europe, US lithium prices especially on battery-grade compared with seaborne Asia market as most of the battery-grade compounds come from Asia to Europe,” an upstream source said.
Fastmarkets’ trade log for battery-grade lithium carbonate in China for June 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.