Can the "abnormal" peak season for lithium exports continue?

The traditional peak season of "Golden September and Silver 10" has passed, and the high prosperity of the lithium battery industry is still continuing, and the structural improvement signs are obvious.

Last week, lithium carbonate futures prices rose multiple times, with the main contract 2501 surging to 87600 yuan at one point, driving other month contracts to collectively rise to the 80000 yuan range. The spot prices of lithium carbonate from some institutions have also rebounded, and the latest batch of lithium carbonate spot auctions held by Yabao was 83,400 yuan/ton.

According to the pattern that supply exceeds demand, and the logic that high lithium prices will restrain consumption and stimulate supply, the space for a lithium price to rebound is still limited. However, the "anti-seasonal" strengthening of the demand side related to this price rebound is worth paying attention to. In the short term, the demand for lithium batteries has exceeded expectations since November due to factors such as the amplification of the subsidy effect of "trade-in" of new energy vehicles, the rise of Trump and the adjustment of battery export tariffs. According to market data, the "trade-in" policy continues to stimulate, and more than 60% of the applications for subsidies for new energy vehicle have boosted the production and sales of new energy vehicles from January to October this year to 9.779 million and 9.75 million respectively, both exceeding the production and sales of last year, and driving the expected production and sales in 2024 to increase from 11.5 million to 12.5-13 million.

At the same time, on November 6th, the next president of the United States confirmed Trump, which strengthened the expectation of increasing tariffs and led to a defensive early "export snap-up" in the lithium battery industry chain. At the macro-policy level, in mid-November, the Ministry of Finance and the State Taxation Administration of The People's Republic of China announced that they would adjust the export tax rebates for some products from December 1st. The export tax rebate rate for products such as lithium batteries will be reduced from 13% to 9%, and the short-term exports boom may intensify. In the long run, the signal of demand side reversal comes from the structural adjustment that has been fermenting within the industrial chain for a long time. 

The adjustment of export tariffs for lithium batteries essentially puts higher demands on the capacity utilization and cost control ability of related enterprises, further releases the long-term determination to promote the optimization of industrial structure.

It is also worth noting that the industry believes that the new energy market in Europe is expected to enter a high boom cycle by 2025. The year 2025 is a key milestone for the European Union to reduce the average carbon dioxide emissions from automobiles by 15% compared to 2021.

At present, there are still large auto companies such as Ford, Volkswagen and Toyota that have not reached this goal. This kind of pressure will push related car companies to increase their investment in electric vehicle. The substantial promotion of the technology licensing model will bring new changes to the upper limit of demand and growth potential of lithium and materials.