GFEX imposes daily position limits on Sept lithium carbonate contract for non-members

The Guangzhou Futures Exchange (GFEX) has set a daily position limit of 3,000 lots for non-futures firms and individuals on its September lithium carbonate futures contract, effective July 28. The move aims to address sharp price spikes and market volatility, even as oversupply persists.

Key takaways:

  • GFEX sets position limits for lithium futures: Guangzhou Futures Exchange caps daily positions at 3,000 lots for non-futures firms on September lithium carbonate contracts to manage volatility.
  • Lithium prices spike despite oversupply: Bullish sentiment and supply concerns drive sharp price increases in Chinese and global lithium carbonate markets.
  • Global lithium futures activity rises: Trading surges on CME, SGX, ICE, and LME lithium contracts amid recent price rebounds.

GFEX introduces daily position limits for lithium carbonate futures

The Guangzhou Futures Exchange (GFEX) has announced that, starting from the trading session on Monday July 28, non-futures firms or individuals will be subject to a daily opening position limit of 3,000 lots on the most-actively traded September contract lithium carbonate futures contract (LC2509). The notice was released after market close in the evening Beijing time on Friday July 25.

The new daily opening position limit, which refers to the sum of the number of ‘buy’ opening positions and the number of ‘sell’ opening positions of non-futures firms or individuals on a single contract on that day, does not apply to hedging or market-making positions. GFEX said that these positions have different requirements.

Volatility in lithium carbonate futures sparks regulatory action

GFEX, which started trading its lithium carbonate futures contracts in July 2023, said it may further adjust the trading limit. This will depend on market conditions.

GFEX’s decision comes after the most-actively traded September lithium carbonate contract on the exchange saw sharp increases in its closing price on consecutive days. It hit the daily upper limit of 8% for a price increase on both Thursday and Friday.

The September lithium carbonate futures contract closed at 80,520 yuan ($11,233) per tonne on Friday, up sharply from 76,680 yuan per tonne on Thursday, and up from 69,380 yuan per tonne on Wednesday.

“I’m not surprised [by the GFEX decision] after all this volatility, [but] without market fundamentals supporting price increases,” said a trader.

Interested in lithium carbonate prices? See live prices, full price history, and spot benchmarks.

Lithium carbonate prices surge amid bullish sentiment

Chinese domestic physical spot lithium carbonate prices soared in the week to Friday. This was driven by the surge in the GFEX futures market, following bullish sentiment and concerns over supply disruptions.

Fastmarkets’ daily price assessment for lithium carbonate, 99.5% Li2CO3 min, battery grade, spot price range, exw domestic China, was 75,000-80,000 yuan per tonne on Friday. This marked an increase from 72,500-76,000 yuan per tonne on Thursday, and up from 65,000-68,000 yuan per tonne a week earlier.

“Fundamentally the market hasn’t changed, there is still a lot of oversupply and inventories continue to build in China,” said Michael Greenfield, battery metals broker at GFI group.

Lithium carbonate prices in the CIF China, Japan Korea (CJK) market and CIF China spodumene prices also followed the sharp uptrend in the Chinese domestic spot price.

Fastmarkets’ benchmark price assessment for lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif CJK was $8.95-9.30 per kg on Friday. This marked an increase from $8.50-9.10 per kg a day earlier, and from a recent low of $7.50-8.60 per kg one month earlier on June 26.

Fastmarkets’ price assessment for lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price cif CJK was $7.70-8.70 per kg on Friday. This marked a widening upward from $7.70-8.40 per kg a day earlier.

Fastmarkets’ daily assessment for the physical spot price of spodumene min 6% Li2O, cif China was $820-880 per tonne on Friday. This marked a sharp increase from $770-850 per tonne a day earlier, and up from a recent low of $595-630 per tonne on June 5.

Global lithium futures markets see increased activity

Futures activity also increased on the Chicago Mercantile Exchange’s (CME) cash-settled lithium hydroxide and lithium carbonate futures contracts amid the recent price rebound.

Trading volumes on the CME lithium hydroxide contract reached a two-week high of 1,231 lots on Thursday. Meanwhile, the September 2025 contract saw a block trade as high as $10.80 per kg on Friday.

Trading volumes on the CME lithium carbonate contract reached a recent high of 245 lots on Thursday. Meanwhile, the September 2025 contract saw a block trade as high as $10.70 per kg on Friday.

Lithium hydroxide, lithium carbonate and spodumene contracts such as the CME’s, the Singapore Exchange’s (SGX), Intercontinental Exchange’s (ICE) and the London Metal Exchange’s, are all underpinned by Fastmarkets assessments.

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