Chinese Lithium Carbonate Offers Dropping Amidst Low Demand

Singapore: Since the January 2023 start, the Lithium Carbonate benchmark offers have persistently remained on a bearish trajectory. The buying appetite has been further curtailed, instigating an identical trend across all regions. The cost support from the feedstock Spodumene has also plunged in the past couple of weeks. As a ripple effect, the Ex-China discussions for Lithium Carbonate battery grade were has dropped by ranging from 1.99% to 3.70% to USD 72866 per tonne to USD 77328 per tonne last week, depending upon the availability and demand in specific provinces.

As per the market sources, some cathode producers were absent from the market and temporarily suspended operating rates at the facilities amidst the inadequate inquiries booked for January 2023. The cathode makers are currently heavily dependent on their inventory levels. In addition, long-term contractual inquiries were preferred, and spot trading remained muted in the last couple of weeks. At the same time, the upcoming Lunar New year holidays have bottlenecked the availability of transportation and shipping freights from China, impacting the Lithium carbonate market.

The downstream players are closely monitoring the developments in the domestic market and showcasing no hurry as they anticipate that the offered quotations will edge even lower. As a ripple effect, the overseas player demanded a wider window of negotiations for Lithium Carbonate over the inquired volumes. As a ripple effect, the seaborne East Asia Lithium Carbonate prices trended lower over the past few weeks, as the downstream players expected the seaborne Lithium Carbonate offers to follow the same suit.

The slowdown of the Chinese Lithium Carbonate market has also impacted the Europe and US spot prices to follow a downtrend followed by the offers of the feedstock Spodumene in recent terms. However, the absence of Russian raw materials kept the supply of Lithium Hydroxide technical grade tight, leading to persisting on a bullish trend.   

As per the ChemAnalyst pricing intelligence, the Lithium Carbonate market in China will improve after the Lunar New Year holidays. Although, the offers will remain staggering as the downstream cathode manufacturers have ample availability to support the production and inquiries till the end of the first quarter of 2023.