GLOBAL LITHIUM WRAP: Upcoming contract price negotiations suspend global lithium prices

Global lithium prices have stabilized ahead of 2019 contract price negotiations after 10 months of a downward price trajectory.

The domestic Chinese spot market has become static ahead of 2019 contract price negotiations, with market participants spoken to by Fastmarkets expecting stable spot prices to continue into the following week.
  • Battery-grade lithium carbonate and hydroxide spot prices in China remain stable ahead of contract price negotiations for next year. 
  • Lower levels of production in Qinghai due to weather conditions highlighted as an additional factor behind price stability. 
  • Lithium spot prices stable in the rest of the world. 
  • Chinese converters and lithium hard-rock miners expect lower lithium spodumene prices for 2019. 
Fastmarkets assessed the Chinese domestic spot battery-grade lithium carbonate (min 99.5% Li2CO3) price at 74,000-83,000 ($10,686-11,986) yuan per tonne on Thursday November 8, unchanged week on week.

“Prices have stabilized over the course of the past two weeks,” a Chinese cathode-battery producer told Fastmarkets. “Next year’s contract price negotiations have kept us busy and we anticipate to get the same or discounted prices in 2019 due to the lower prices in China.”

“Lithium prices for both carbonate and hydroxide battery compounds are indeed stable as everyone is currently negotiating next year’s contracts,” a lithium producer told Fastmarkets.

Lower volumes of Qinghai material entering the market, due to the lower levels of production because of winter conditions, was also cited as a main reason for the lower levels of material in stock, therefore, creating price stability.

Meanwhile, the battery-grade lithium hydroxide spot prices also maintained their current level from last week on thin trading and the ongoing contract negotiations.

Fastmarkets assessed the battery-grade lithium hydroxide monohydrate (min 56.5% LiOH.H2O) spot price at 110,000-120,000 yuan per tonne on Thursday November 8, unchanged week on week.

Despite the spot price stability in China, Chinese hard-rock converters and lithium-spodumene miners expect lithium spodumene prices to soften in coming months, affected by the 10-month downtrend in the lithium carbonate price in China, against which miners would typically peg their lithium spodumene price.

The spot price for battery-grade lithium carbonate, min 99.5% Li2CO3, ex-works China, was assessed at 74,000-83,000 yuan per tonne on November 1, a 50% decline from 158,000-160,000 yuan per tonne on January 4.

“There is still an undeniable appetite for lithium spodumene in China as the brine producers can’t keep up with current demand for lithium compounds,” a lithium spodumene miner told Fastmarkets.

“Having said that, we anticipate seeing lower spodumene prices in 2019 as converters in China are refusing to pay as high as $900 per tonne, as seen in 2018 contracts,” he added.

“We have been in negotiations to keep buying lithium spodumene next year and our conversations with our suppliers would situate the market somewhere between $700-800 per tonne for 2019,” a Chinese converter told Fastmarkets.

“However, we have been told of prices below $700 per tonne due to the current lithium carbonate prices in China,” he added.

Fastmarkets lithium spodumene monthly price was last assessed at $700-800 per tonne, cif China, on October 31, down by 6.25% from $750-850 per tonne on September 26.

Seaborne Asian prices flat
Seaborne cif China, Japan and Korea battery-grade lithium carbonate and hydroxide prices remained flat week on week due to thin trading activity, due to most market participants working to lock 2019 contract prices.

Fastmarkets last assessed the battery-grade lithium carbonate (min 99.5% Li2CO3) price at $13-15 per kg on Thursday November 8, unchanged week on week.

Meanwhile, the lithium hydroxide (min 56.5% LiOH.H2O) cif China, Japan & Korea was assessed at $15-18 per kg on Thursday November 8, stable with the previous week’s assessment.

“There has been a lot of talk about 2019 contract prices, however, we have had no spot inquiries,” a lithium trader told Fastmarkets.

“The seaborne cif China, Japan and Korea market remains flat this week with little inquiries or appetite since everyone is negotiating next year contracts,” a second lithium producer told Fastmarkets.

European, US prices steady

The European and US lithium spot markets, which are typically less volatile due to lower volumes of material traded, similarly remained unchanged week on week on thin trading while negotiations take place.

Fastmarkets last assessed the battery-grade lithium carbonate price at $13-15 per kg, on a delivered duty-paid basis to Europe and the United States, on Thursday November 8, unmoved from last week.

Meanwhile, the battery-grade lithium hydroxide monohydrate (min 56.5% LiOH.H2O) spot price was last assessed by Fastmarkets at $15-18 per kg on Thursday November 8, on a delivered duty-paid basis to Europe and the US, another non-mover.

Fastmarkets’ trade log for battery-grade lithium carbonate in China for November includes all trades, bids and offers reported to Fastmarkets.

Learn more about Fastmarkets’ lithium pricing methodology and read the latest lithium price spotlight here.

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

Global lithium market prices

Martim Facada

martim.facada@indmin.com

Carrie Shi

Carrie.shi@indmin.com

Published

Martim Facada

Carrie Shi

November 09, 2018

13:50 GMT

London, Shanghai