Chinese lithium prices fall amid volatility in futures; CJK flat on thin trading

China’s lithium carbonate prices fell in the week to Thursday August 29, amid volatility in futures prices. Hydroxide prices also softened on the back of muted spot demand

Lithium prices in the CIF China, Japan and Korea (CJK) market held steady in the week to Thursday, following scarce spot demand and thin liquidity.

Chinese lithium prices

The liquidity of battery-grade lithium carbonate was slightly more active compared to previous weeks, given small-scale restocking activities among consumers, sources told Fastmarkets.

“The spot liquidity is better this week. The consumers started restocking on a small scale, since they have been operating on low inventories for months. But the restocking is just on a hand-to-mouth basis,” a Chinese lithium trader said.

Output of lithium iron phosphate (LFP) battery cathodes is expected to increase in September and help support lithium carbonate demand, sources said.

But several market participants were still not optimistic about lithium prices in the near term, citing the pressure from ongoing oversupply.

“Despite a slight easing, oversupply remains. Market fundamentals are still weak, given that the restocking is only done at a very small scale,” a Chinese lithium producer source said.

The most active 2411 lithium carbonate futures contract on Guangzhou Futures Exchange closed at 76,850 yuan ($10,828) per tonne on Thursday, up by 1,400 yuan per tonne from the closing at 75,450 yuan per tonne a week earlier.

The 2411 contract moved between 73,100-78,100 yuan per tonne during August 23-29.

Fastmarkets’ weekly price assessment of the lithium carbonate 99.5% Li2CO3 min, battery grade, spot price range exw domestic China was 71,600-75,000 yuan per tonne on Thursday, narrowing from 71,000-77,000 yuan per tonne a week earlier.

The midpoint of the latest assessment at 73,300 yuan per tonne was down by 700 yuan per tonne from the midpoint at 74,000 yuan per tonne a week earlier.

The lithium hydroxide market remained quiet in the week to Thursday, according to sources.

“There’s basically no demand besides the long-term deliveries. The nickel cobalt manganese battery sector seems devoid of activity,” a second Chinese lithium producer source said.

Fastmarkets’ weekly price assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price range exw domestic China was 71,000-75,000 yuan per tonne on Thursday, narrowing down by 1,000 yuan per tonne from 71,000-76,000 yuan per tonne a week earlier.

Lithium prices in CIF CJK market

Lithium prices in the CIF CJK market remained unchanged in the week to Thursday, amid muted spot liquidity, sources said.

“The CJK market is very quiet as consumers have no additional demand for battery-grade lithium carbonate and hydroxide apart from their long-term orders,” a trader in East Asia said.

“Even though there has been some volatility in China’s domestic market in recent weeks, the East Asian consumers are still very cautious… The consumers think there is still downside room for lithium prices given the overall weak fundamentals,” a third Chinese lithium producer source said.

Fastmarkets’ daily price assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price cif China, Japan & Korea was $9.90-11.20 per kg on Thursday, unchanged since August 21.

Fastmarkets’ daily price assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea was $10.20-11.50 per kg on Thursday, unchanged since August 22.

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