Lithium Carbonate Prices Strongly Rebound Amid Dual Supply-and-Demand Boost

October 28th, news

According to the commodity market analysis system: The price of lithium carbonate is experiencing an unexpected price rebound. As of October 28, the spot benchmark price for battery-grade lithium carbonate in China is 78,400 CNY/ton, up 7.51% from the beginning of the month, up 7.03% month-over-month, and down 0.76% year-over-year; the benchmark price for industrial-grade lithium carbonate in China is 76,633 CNY/ton, up 7.3% from the beginning of the month, up 7.13% month-over-month, and down 0.31% year-over-year.

The core logic of the price increase: dual drivers of demand exceeding expectations and accelerated inventory destocking in China.

Demand Side "Off-Season Not Dull": The dual efforts of the new energy vehicle and energy storage, two major markets: In the first nine months, new energy vehicle sales increased by 35% year-on-year, far exceeding the initial expectations of 20% to 28%, with a full-year growth rate of over 30% now certain; overseas orders for energy storage increased by nearly 132% year-on-year. Overseas orders for Chinese first- and second-tier manufacturers are already booked until next year.

De-stocking Boosts Market Confidence: Since August, the lithium carbonate market has been steadily reducing its inventory. As of the week ending October 24, weekly stock levels fell to 130,000 tons, a week-on-week decrease of 2,292 tons. While the 130,000-ton inventory level remains relatively high, growing downstream demand has alleviated any significant pressure on stocks.

There is positive support on the supply side in China.

Contemporary Amperex Technology Co. Limited (CATL) has halted production, and the delay in resuming production of some capacities in Jiangxi due to the expiration of mining permits provides favorable support for prices. As winter approaches, the salt lake capacities in Qinghai and Tibet will enter seasonal restrictions, further limiting the supply increase.

Lithium carbonate data analysts believe: In the current market environment where inventory depletion is accelerating and demand growth exceeds expectations, lithium carbonate prices have rebounded strongly. The short-term supply and demand situation is favorable, but in the long term, there are still uncertainties on both the demand and supply sides, and market changes need to be closely monitored.