GLOBAL LITHIUM WRAP: Sluggish demand, cheaper material weigh on China’s battery-grade carbonate prices

China’s domestic spot battery-grade lithium carbonate prices fell on Thursday July 5 due to continued weak demand and the availability of cheaper material; hydroxide prices held steady with most producers maintaining their offers although lower prices are starting to be offered.

  • Chinese lithium carbonate prices fell on lower consumption 
  • Cheaper battery and industrial-grade carbonate prices offered from Qinghai producers keep weighing on the Chinese spot market 
  • Lithium hydroxide prices still under downward pressure though battery-grade quotation held steady 
  • Lower carbonate prices in China pushed down prices elsewhere.

Spot battery-grade lithium carbonate prices failed to hold on to short-term stability seen last week after some producers lowered their offer prices to boost sales and generate cash flow.

Downstream Chinese consumers are holding back from making further purchases of battery-grade lithium compounds because they anticipate lower prices in the following weeks.

Metal Bulletin assessed the Chinese domestic spot battery-grade lithium carbonate price (min 99.5% Li2CO3) at 115,000-120,000 yuan ($17,338-18,092) per tonne on Thursday, down from 120,000-125,000 yuan per tonne in the previous week.

“The battery-grade lithium carbonate market remains quiet [having seen] concluded deals reached at lower prices due to build up in inventory among producers and lackluster demand from downstream consumers,” a lithium producer told Metal Bulletin.

“We have locked in several lithium battery-grade truckloads over the past days at prices as low as 115,000 yuan per tonne and we would not be surprised to see lower prices in the market over the course of the following weeks,” a Chinese cathode-battery maker said.

Industrial-grade lithium carbonate and lower quality battery-grade material offered from the Qinghai region have been a major factor behind the movement down in prices this week, market sources told Metal Bulletin.

“There is a lot of cheaper material in the market suitable for battery consumption and that is not synonymous with lower quality material as some say,” the cathode-battery maker added.

Metal Bulletin assessed the Chinese domestic technical and industrial-grade lithium carbonate price (min 99% Li2CO3) at 95,000-100,000 yuan per tonne on Thursday July 5, down from 100,000-105,000 yuan per tonne from previous week.

Some market participants reported having heard domestic technical and industrial-grade lithium carbonate prices as low as 85,000 yuan per tonne being offered within the Chinese spot market although no concluded sales have been reported.

Meanwhile, although the new energy vehicle (NEV) subsidies policy have already taken effect, demand for battery-grade lithium hydroxide has not picked up in the near term and the market remained flat in the latest pricing session. 

Battery-grade lithium hydroxide monohydrate (min 56.5% LiOH.H2O) prices were unchanged at 130,000-135,000 yuan per tonne on Thursday, according to Metal Bulletin’s market assessment.

While offers were heard below the assessed range, lithium producers were resistant to lowering their offers further in anticipation for a resumption in demand later in the year.

“I heard some deals concluded below 130,000 yuan per tonne on the spot market for battery-grade lithium hydroxide, but we won’t sell material below 130,000 yuan per tonne for the time being,” a second producer told Metal Bulletin.

“I keep my positive outlook for the fourth quarter of the year as demand is anticipated to pick up as cathode and battery producers typically buy more material during this period of the year to fulfil their production quotas and receive the subsidies,” the producer added.

Seaborne Asian carbonate prices adjust
Elsewhere, cif China, Japan and Korea battery-grade lithium carbonate prices dropped 2.6% this week due to slower Chinese demand.

Metal Bulletin’s battery-grade lithium carbonate (min 99.5% Li2CO3) prices were assessed at $18-19 per kg on a cif China, Japan and Korea basis on Thursday, down from $18-20 per kg.

Meanwhile, hydroxide (min 56.5% LiOH.H2O) prices held at $19-20 per kg cif China, Japan and Korea.

“The battery-grade lithium carbonate and hydroxide seaborne cif China, Japan and Korean spot markets remain quite slow as suppliers keep holding back on selling material at prices as low as Chinese domestic prices,” a trader told Metal Bulletin.

“We won’t sell any of our battery-grade material below $18 per kg but we have already seen offers and bids in the market as low as $17 per kg,” the trader added.

“The Chinese market is pushing the seaborne cif China, Japan and Korea market down and we have started to see several offers of material as low as $17 per kg,” a third lithium producer told Metal Bulletin.

European, US assessments dip
Meanwhile, European and US battery-grade lithium carbonate prices softened week on week due to the lower prices in China and sluggish markets.

Metal Bulletin’s battery-grade lithium carbonate prices fell to $17-19.50 per kg delivered duty-paid in Europe and the United States on Thursday from $17.50-20 per kg a week ago. Hydroxide spot prices were stable at $19-20 per kg.

Moreover, both technical and industrial grade lithium carbonate and hydroxide prices moved down week on week, following lower Chinese domestic spot market prices.

European and US technical and industrial-grade lithium carbonate price (min 99% Li2CO3) stood at $16-18 per kg on Thursday compared with $17-18 per kg previously. Technical and industrial-grade lithium hydroxide prices (min 56.5% LiOH.H2O) fell by $1 on both ends of the range to $17-19 per kg from $18-20 per kg.

“The European and US markets always lag in price behind the Chinese domestic market but the influence of the latter is undoubted and prices in Europe and US have started moving down,” a fourth lithium producer told Metal Bulletin.

Metal Bulletin lithium prices

Metal Bulletin’s trade log for battery-grade lithium carbonate in China for July includes trades, bids and offers reported to Metal Bulletin.

Learn more about Metal Bulletin's lithium pricing methodology and read the latest lithium price spotlight.

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

Martim Facada

martim.facada@indmin.com

Carrie Shi

Carrie.shi@indmin.com

Published

Martim Facada

Carrie Shi

July 06, 2018

13:10 GMT

London, Shanghai