US Lithium Carbonate Prices Decline Amid Import Pressures and Sluggish Demand

Texas, USA: The US Lithium Carbonate market has sustained weakness in the month of November 2023, and the prices have been declining on a week-on-week basis due to imports of cheaper goods from South America and sluggish demand from the downstream electric vehicle battery manufacturing industries. As of November 24, 2023, the price of Lithium Carbonate Battery Grade DDP USGC was assessed at USD 19900/MT.

The rising domestic production of Lithium Carbonate and decreased raw material prices have also weighed upon the Lithium Carbonate market. Following a similar trend as in China, the US and European markets have been tumbling amid surplus inventories and bleak downstream demand.

Furthermore, amid falling prices of Lithium Carbonate, the downstream markets for other lithium salts, such as lithium hydroxide and lithium hexafluorophosphate, also fell as manufacturing costs decreased week after week. Sellers in the cathode production business also reported plentiful material supply, and as a consequence, the procurement of newer supplies has remained minimal.

Lithium Carbonate prices in China fell further this week, reaching a two-year low, after a trial delivery of the metal to the Guangzhou Futures Exchange revealed greater-than-expected supplies in the world's leading battery manufacturer.

On the contrary, the sales of electric vehicles are rising month-on-month as the electric car battery costs are also decreasing as key battery components such as Lithium Carbonate become less expensive, making the vehicles cheaper. The Inflation Reduction Act, which boosted tax credits for qualified new and used EV purchases, also helped consumers save more money, depending on specific conditions.

According to market giants in the electric vehicle industry, electric car sales in the United States are likely to reach a record 9% of all passenger vehicles this year. This will be an increase from 7.3% of new car sales in 2022. According to the research organizations, this will be the first time that more than one million EVs are sold in the United States in a single calendar year, with sales likely to range between 1.3 million and 1.4 million vehicles.

According to the ChemAnalyst database, the Lithium Carbonate market is anticipated to demonstrate further weakness in the upcoming weeks as poor demand conditions are presumed to continue in the region. Given the sluggish near-term demand for Lithium Carbonate from battery manufacturers, lithium prices are expected to stay at lower levels. Additionally, if spodumene prices have not yet reached their bottom, there is still an opportunity for lithium salt prices to fall.