- Bullish momentum continues for lithium salts
- Spodumene supply tightness persists
Platts assessed battery-grade lithium carbonate at Yuan 520,000/mt Sept. 23 on a delivered, duty-paid China basis, up Yuan 5,000/mt on the day and Yuan 8,000/mt on the week.
Tradable levels for battery-grade lithium carbonate converged in the Yuan 500,000-Yuan 530,000/mt range in the week ended Sept. 23, with multiple trades done at the higher end of the range at Yuan 520,000-Yuan 530,000/mt through the week.
A Chinese consumer said demand might pick up as China heads for the Golden Week holiday, with market participants seeking to buy more due to short-term uncertainty.
Market sources are bullish and expect lithium salt prices to continue increasing because of a shortage of lithium salts and macroeconomic factors such as yuan's depreciation that increases capital costs.
“Everyone feels that lithium carbonate prices will go up with lithium hydroxide following suit," a Chinese producer said, adding that most producers are currently fulfilling backorders from early September.
A Chinese converter was cautious and said it was difficult to predict how the market would trend in the wake of downstream demand and tolerance to higher prices.
A Chinese producer was skeptical that a rally in prices will last as price were likely higher due to a seasonal trend.
“If one were to look at the characteristics of previous years, there’s a clear trend that prices would rise to a certain extent in fourth quarter," the producer said.
Platts assessed battery-grade lithium hydroxide at Yuan 505,000/mt Sept. 23 on a delivered, duty-paid China basis, up Yuan 2,000/mt on the day and Yuan 5,000/mt on the week.
Tradable values were pegged in the Yuan 500,000-Yuan 530,000/mt range in the week to Sept. 23
“I feel that prices will recover; downstream demand has been increasing with supply lacking behind," a Chinese producer said.
A Chinese producer said high lithium salt prices have weighed on 3C demand.
Platts assessed spodumene concentrate with 6% lithium oxide content at $7,000/mt FOB Australia Sept. 23, up $450/mt from the previous week.
Tradable levels were in the $6,000-$7,300/mt range in the week ended Sept. 23 as spot supply remained tight.
September's auction for spodumene with 5.5% lithium oxide content concluded at a higher price of $6,988/mt on an FOB Port Hedland basis.
The auction price increase exceeded market participants' expectations. A Chinese producer said this was understandable due to a lack of raw material supply.
A Chinese producer said a higher auction price is an indication of "great confidence" in lithium salt prices and provides the spot market with a direction heading into January 2023.
The spodumene batch in the auction would only be converted into battery-grade lithium carbonate in January 2023 and indicates there are participants who are bullish until then, a Chinese trader said.
“If lithium salt prices in January remain at current levels, then buying spodumene at $7,000/mt is still profitable,” the trader said.
Platts is part of S&P Global Commodity Insights.