Lithium Carbonate's 2024: ‘After half a lifetime, it's still 90,000 yuan’！

Lithium Carbonate's 2024: ‘After half a lifetime, it's still 90,000 yuan’！

1) Price Review

In 2024, the price of lithium carbonate fluctuated a lot. Although it is not like the 'jumping' stimulus of dropping from 500,000 yuan/ton to 100,000 yuan/ton in 2023, the price of lithium carbonate is on a roller coaster in 2024 under the stimulation of periodic mismatch between supply and demand and occasional overseas export. The highest point was at 110,000 yuan/ton, and the lowest point fell to 72,000 yuan/ton, with an annual average price of 90,000 yuan/ton. Following the 'half-life, come back or 90,000 ',the 2024 annual average price again fell to 90,000 yuan/tonne.

Periodic price review: the disk price of short-term futures from January 2024 to early February 2024 was higher than the spot price, which made some lithium salt factories deliver and strengthened their price mentality. In the late January period, some anode factories considered the logistics suspension during the Spring Festival. There was a small amount of pre-holiday replenishment of the library, which led to the price of lithium salt slightly upward.

From the end of February 2024 to the beginning of April 2024, the environmental inspection in Jiangxi and the overhaul and production reduction of Sichuan Lithium Salt Factory led to the market's expectation of the short-term supply reduction of lithium salt after the year. Superimposed on the terminal electric car price war in March and new models triggered by a substantial increase in demand, prompting lithium salt spot prices to rise. At the same time, some lithium salt enterprises supported the selling price, which makes the supply of low-priced goods in the spot market scarce and prices rises steadily.

Late April 2024 - Late August 2024 upstream lithium salt supply side of the volume level to maintain high operation, but the new energy terminal demand growth slowed down to drive the anode factory scheduling down. Most of the lithium salt inventory of anode factories was maintained at a high level in the second quarter, and the long-term agreement and customer supply volume recovered significantly in May-July, and the zero-single spot was mainly purchased on demand, with no stock preparation plan for the time being. The spot trading market of lithium carbonate is relatively deserted, and the prices is down.

From Early September 2024 - to late November 2024 into September, the head of the Jiangxi region lithium salt plant significantly reduced production led to the next visitor supply level being significantly affected, coupled with the downstream scheduling continued to rise, and generally carry out the National Day pre-pre-preparation, lithium carbonate zero single purchasing demand significantly pull, spot prices slowed down, and accompanied by a rebound in shock. Late October, by the end of the year-end of the end of the enterprise rush to load the amount of pull, the downstream material plant and the upstream smelting plant just need to buy. Downstream material factory and upstream smelters have incremental production, and the spot trading of lithium carbonate is relatively active, which drives the spot price center of lithium carbonate to rebound slightly in October-November.

Early December 2024 - late December 2024 price rebound drives upstream smelter production enthusiasm, and domestic lithium carbonate supply continues to increase. However, it is just at the 2025 LCA discount negotiation node, that the upstream lithium salt plant on the LCA discount and spot are holding a strong price support sentiment. Judging from the transaction in December, the downstream material factory has entered the Spring Festival to stock up. Because of the high inventory level, it is expected that the traders will stock up at the end of the year and return the funds. Therefore, lowering the point price has promoted the transaction with the downstream material factory. The trading situation in the market is more active, and the price showed a small downward trend. 

2) Supply-side review

In 2024, the domestic total output of lithium carbonate was about 680,000 tons, a year-on-year increase of 47%. From the type of raw material, spodumene accounts for half of the country, accounting for about 48%, up 116% year-on-years. The production of lithium carbonate at the end of spodumene has increased significantly mainly due to the commissioning of the new production line of the integrated lithium salt factory and the fact that the demand market for lithium hydroxide is relatively depressed and the hydrocarbon spread continues to expand; The high cost pressure of lepidolite at the end of the year and environmental protection problems, combined with the tight supply of high-grade lepidolite in the Jiangxi, slowed down the production growth, increasing by 17% year-on-year; Salt Lake continued to increase its volume by 37% due to its cost advantage; At the end of recycling, due to the structural shortage of raw materials caused by the mismatch of resources in the field of waste batteries at present, the production capacity can not be effectively utilized, and the pressure of profit losses is superimposed. The output in 24 years has decreased by 19% year-on-year, accounting for only 10.

Judging from the current changes in the market share of CR 5, the industrial concentration of lithium carbonate enterprise is still relatively small, and there are more industry participants. Under the continuous investment in new production capacity, the concentration of the industry has further declined.

According to customs data, the imports volume of lithium carbonate in China will reach about 230,000 tons in 2024, up 46% year-on-year. Chile and Argentina are still the main importers of lithium carbonate in China, and the import of lithium carbonate from Chile is about 180,000 tons, up 29% year-on-year, accounting for 78% of China's total imports; The import of lithium carbonate from Argentina are about 45,000 tons, up 156% year-on-year, accounting for 20% of China's total imports.

In terms of export, China's export share of lithium carbonate is small, and it is still difficult to see obvious signs of improvement in overall overseas demand. The production cost of lithium carbonate in overseas salt lakes is relatively more price-advantageous. In 2024, the exports volume of lithium carbonate in China was less than 500,000 tons. 

3) Supply and demand balance

In 2024, lithium carbonate continues the cumulative inventory mode, with an annual surplus of about 60,000 tons and a cumulative inventory of about 110,000 tons (the inventory of sample statistics). On the one hand, the supply of lithium carbonate decreased significantly due to the reduction of production in a lithium salt factory in Jiangxi Province in early September; On the other hand, because the demand exceeding the expectations of the peak season effect, there is a pattern of inventory during September-November. On the whole, the pattern of oversupply is continuing.

From the demand side, China remains the largest country for new energy vehicles and energy storage. The power market, the central political bureau held a meeting on December 9, that the 2025 policy environment is still warm, conducive to the automotive industry to maintain healthy development, coupled with 2025 being the last year of the 14th five-year plan, stimulating consumers to replace the high demand for cars, SMM for the 2025 car sales are expected to be more optimistic, the year will reach more than 20% growth rate is expected. In the energy storage market, driven by policies, China's performance will continue to shine in 2025, and the growth rate is expected to reach over 20%.

From the supply side, at present, the overall operating rate of the upstream lithium salt plant is only 50-60. And in 2025, there will still be some new capacity waiting to be invested. It is estimated that the domestic lithium carbonate production will increase by more than 25% in 2025. In the future, the integration of the industry will be gradually deepened. And in the continuous release of overseas lithium carbonate production capacity, superimposed on the slower growth of overseas demand, overseas lithium carbonate surplus intensified, will promote more low-cost lithium carbonate influx into the Chinese market, which will cause some resistance to the incremental high-cost lithium salt plant, and even make it reduce the amount of or clear out.

In 2025, the supply and demand of lithium carbonate will increase at the same speed, but the growth rate of supply will be better. The annual surplus will continue to amplify the price of lithium carbonate, and there is some room for decline. Although the price of some lithium mines are close to the coastline at present, and the strong depressed mood of lithium mine enterprises in lithium mines can support the production cost of lithium carbonate to some extent, the deepening of low-cost integration in the industry and the continuous increase in imports still have room for downward adjustment in the domestic price center of lithium carbonate. It may be just a good wish for the industry to expect lithium carbonate to return to 100,000 yuan/ton.