What’s new: The price of lithium carbonate, the key raw material for power batteries, fell by half over four months, reflecting weakened demand.
The spot price of lithium carbonate in China was 290,000 yuan ($42,138) per ton Wednesday, down 30% from the previous month and 41.7% lower than a year ago, data from metal industry information provider Shanghai Metals Market showed. The price fell by more than 50% from the peak of nearly 600,000 yuan per ton in November 2022.
An industry analyst told Caixin that some battery companies and lithium processors that signed long-term purchase contracts refused to execute the contracts amid the sharp price drop, which led to spot prices falling much lower than their contracted prices.
The context: The continued price drop reflects weak demand from upstream battery makers as EV sales in China continue falling.
New-energy vehicle sales in China totaled 933,000 units in the first two months this year, down 20.8% year-on-year, after the expiration of national subsidies for NEV purchases at the end of 2022.
Tianfeng Securities predicted Tuesday in a report that the lithium price will bottom out at around 200,000 yuan per ton as industry inventories decline. The raw material drop will reduce costs of electric vehicle production, Tianfeng said.
Contact reporter Han Wei (weihan@caixn.com) and editor Bob Simison (bob.simison@caixin.com)
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