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Market participants cited disappointing levels of production and adoption of nickel-rich cathodes such as NCM 811 across Asia as the main factor behind weaker Chinese domestic battery-grade lithium hydroxide prices on Thursday.
Lithium hydroxide is set to be in high demand once nickel-rich cathodes can be produced and used on a larger scale. These type of cathodes typically consume battery-grade lithium hydroxide.
But in the meantime, the bearish market outlook meant Fastmarkets’ battery-grade lithium hydroxide monohydrate (min 56.5% LiOH.H2O) price fell to 83,000-88,000 yuan ($12,007-12,730) per tonne on Thursday, from 85,000-90,000 yuan per tonne the week before.
“Battery-grade lithium hydroxide prices keep falling with lower prices appearing on the spot market. Slow demand from end customers remains the main driver,” a producer said. “Micro-grade lithium hydroxide prices continued to trade at a 5,000-10,000 yuan premium over the current Fastmarkets [battery-grade] price range.”
In contrast to lithium hydroxide prices, the Fastmarkets battery-grade lithium carbonate (min 99.5% Li2CO3) price in China registered a small upward price adjustment to 74,000-78,000 yuan per tonne on Thursday, from 70,000-78,000 yuan per tonne the week before.
However, market participants told Fastmarkets the 2.7% uptick is not a sign of an improvement in market conditions but simply where most of the trading activity happened this week.
Most market participants in China remain pessimistic about the domestic China lithium carbonate price outlook and expect softer prices in the coming weeks.
“We keep buying battery-grade lithium carbonate produced from spodumene at 74,000-75,000 yuan per tonne and we think prices will soften as soon as the ‘slow season’ starts in China, typically during the summer,” a cathode producer told Fastmarkets.
“Our prices are stable but most of the activity this week was toward the upper end of Fastmarkets’ prices range,” a lithium producer told Fastmarkets. “Despite this, we don’t think the market is moving up and it could be prices will soften in the weeks to come due to slower consumption.”
Asian seaborne lithium market The cif China, Japan and Korea battery-grade lithium spot market softened week on week, which market sources attributed to the seaborne region catching up with the price trend in China.
Fastmarkets’ assessed the battery-grade lithium carbonate (min 99.5% Li2CO3) spot price at $11-12.50 per kg on Thursday, down from $11-13 per kg the week before.
The battery-grade lithium hydroxide monohydrate (min 56.5% LiOH.H2O) price followed the carbonate price lower. Fastmarkets assessed the price at $14.50-15.50 per kg on a cif China, Japan and Korea basis on Thursday, from $15-16 per kg the week before.
“[The softening spot prices] was expected and we will soon see this effect on the region’s contract prices,” a second producer source told Fastmarkets.
Lower European and US prices The European and US battery-grade lithium carbonate and hydroxide spot markets fell week on week due to competitive prices offered from China. But the majority of material traded in this region is pegged to mid-to-long-term contracts, Fastmarkets understands.
Fastmarkets’ battery-grade lithium carbonate (min 99.5% Li2CO3) spot price delivered, duty-paid Europe and the United States, fell by 4% week on week to $11-13 per kg on Thursday, compared with $11.50-13.50 per kg the week before.
The Europe and US battery-grade lithium hydroxide monohydrate (min 56.5% LiOH.H2O) spot price was also lower, at $14-15 per kg on Thursday, compared with $14.50-15.50 per kg the week before on a delivered duty-paid basis.
“The European and US market has moved down this week, playing catch up with the Chinese lithium spot price,” a distributor told Fastmarkets. “We can even see battery-grade material being offered in Europe or US from China that will end up with other end users that are not producing batteries.”
“There are prices from China offered even below current Fastmarkets lithium carbonate and hydroxide prices,” a third producer told Fastmarkets. “This will likely push the market down in the coming weeks.”
Fastmarkets’ trade log for battery-grade lithium carbonate in China for May includes all trades, bids and offers reported to Fastmarkets.
Learn more about Fastmarkets’ lithium pricing methodology here and read the latest lithium price spotlight here.
All lithium carbonate, hydroxide and spodumene prices are available in our Battery Raw Materials Market Tracker. Get a sample of the report here.