For the Quarter Ending September 2023
In North America, the price of lithium carbonate continued to decline during the third quarter of 2023. This decline can be attributed to factors such as ample inventories, low import prices, and intensified competition among exporting nations. Notably, within the US market, the prices of lithium carbonate fell due to low demand and an oversupply of the product. Market players in Chile adjusted their profit margins in response to heightened competition with China, aiming to attract more consumers. Inquiries into the product revealed that there were significant inventories of electric vehicles (EVs) with dealers, even though there was an increase in electric vehicle sales. This dynamic reflects weak investor sentiment, largely influenced by the slow recovery of the Chinese economy throughout the quarter. The demand from downstream lithium-ion battery manufacturing and Energy Storage System (ESS) manufacturers remained weak, leading to unfavorable sentiments in the region. As of September 2023, lithium carbonate prices were assessed at USD 29,000 per metric ton.
In the third quarter of 2023, in the Asia Pacific region, lithium prices experienced a decline for several reasons, including ample inventory, limited demand from downstream industries, and low import prices. The price of lithium carbonate in South Korea followed a bearish trend throughout the third quarter due to an economic slowdown in the exporting nation, China. This economic downturn resulted in an oversupply of lithium carbonate in the market. The decline in lithium carbonate prices can be attributed to the absence of significant changes in the relevant factors affecting final prices, including those for lithium carbonate batteries. In response to increased inventory levels and weak demand, China, a major exporting nation, lowered its quoted quotations. Despite this, downstream inquiries from battery manufacturing industries remained stable, particularly in light of increased sales of electric vehicles. Overall, the supply chain operations in the region operated smoothly, and there were no significant reports of port congestion or supply chain constraints. As of September 2023, discussions regarding Lithium Carbonate Battery Grade CIF-Osaka resulted in a settled price of USD 26,376 per tonne.
In Europe, the price of lithium carbonate experienced a sustained decline throughout the third quarter of 2023. This decline was primarily attributed to factors such as a reduced production rate, limited market inquiries, weak demand from the downstream sector, and low import prices. Notably, in Belgium, lithium prices remained consistently low during the entire third quarter. The outlook for Lithium Carbonate in the Belgian market exhibited a bearish trend due to a surplus of product inventories in the region. Moreover, there was a reduced frequency of imports during this period. It is worth noting that there were no significant instances of port congestion or supply chain constraints reported for the quarter. Meanwhile, the demand within the lithium-ion battery manufacturing industry saw a noticeable decline, with consumer inquiries being notably subdued. This decline was further exacerbated by uncertainties surrounding economic conditions and a general downturn in business sentiments. In the electric vehicle market, consumers adopted a cautious "wait-and-see" approach. As of September 2023, the assessed price for lithium carbonate stood at USD 29,000 per metric ton.
The lithium carbonate market in South America observed a bearish pricing trend in the third quarter of 2023. The major exporting nation Chile continued to lower the product prices amid dropping consumer demand. The price of lithium carbonate in Chile fell in July due to lower demand from the downstream battery manufacturing sectors in Asia, Europe, and North America. In mid-Q3, Chile's President declared the nationalization of lithium deposits, which resulted in a drop in lithium stocks throughout the world. Overall, demand in the downstream lithium-ion battery manufacturing industries remained firm, with a jump in new purchase orders in August. The supply chain is currently being reorganized. Core Lithium Ltd reported low production expectations for fiscal years 2024 and 2025. Lithium investor sentiment became negative. The Asian market's inquiries were slow since industry players reported sufficient stockpiles of the commodity in the area. According to market participants, slower product offtakes were recorded due to larger inventories in the domestic market. In the North American market, however, the demand prognosis from the downstream lithium-ion battery manufacturing sectors was stable, and firm new purchase orders were recorded. As of September, the prices of lithium carbonate were assessed at USD 25500 per metric tonne.
For the Quarter Ending June 2023
Following the 1st quarter of 2023, Lithium carbonate prices tumbled to DDP USGC(USA) USD 54700/tonne. In the second week of May price of lithium carbonate decreased further, around 2.1% in the US market as the largest exporter among South American manufacturers; Chile reduced its charges to allure its downstream lithium-ion battery manufacturers and other players. The temporary inactivity of the northeast Asian downstream market impacted the demand percentage growth. Moreover, the Overall lithium carbonate market is stabilized in the USA, assisted by the slowdown in new orders and the slippery slope of export sales. The supply chain operating at optimum levels, and sufficient inventories of the product were reported. However, the supply gap widening and thriving demand for EV batteries mean that these relatively lower prices may not last long. The surge in the spot market prices of Lithium carbonate in the Asian market resulted in the decline of the offered quotes in the region as the market participants lowered the profit margins amidst rising market competition.
For the 2nd quarter of 2023, the prices are still following the bearish trajectory in the South American market and stabilized at USD 46700/tonne in the month of June 2023. This continuous decrease is due to some facts such as the world hunger for Chilean Lithium, the increasing rate of billion dollars of investment for new strategy development in Chile to meet global demand, maximize the benefits to its people, and environmental sustainability. Further, Chile is focusing on upscaling its domestic inventory and widening its supply chain, as Chile owns 36 percent of economically recoverable lithium reserves and accounts for about 26 percent of global production; hence any setback to Chile’s lithium carbonate supply would add a major percentage in global lithium supply deficit and thus higher battery cost. The Chilean government does also mark a good score in the global competition by making partnerships with private sector companies that possess world-renowned technical expertise and financial resources to expand sustainable production.
The price trend of the first half of Q2 also follows the bearish trajectory of the last month of 1st quarter, 2023, and closed the window at USD 25900 (Ex-Shenzhen, China) due to low price pressure from the upstream market. In the second half, the prices bounced back and hit the price of USD 43700 (Ex-Shenzhen, China). The domestic inventories started drying up as it became very difficult for domestic players to procure raw materials due to the inadequacy of upstream lithium mica and the sluggish pace of the lithium carbonate manufacturing rate. If we look around the demand scenario, several facts are playing there, such as shifting consumer preference to Electric vehicles (EVs) from traditional ICE cars, Foreign major player investments, all of which set the demand rocket high, valued at around 964,000 tonnes/year. Further, as per economic experts, a lithium supply deficit will continue until 2027, at which point production will overtake demand. As it will take a decade for the lithium mines to get run, it is estimated by the demand-supply curve that the market will see a price surge of Lithium.
At the start of 2nd quarter of 2023, due to declining demand from the downstream Electric vehicle(EV) industry, the market sentiments for lithium carbonate slept down in April. The export data also shows a downfall in nature due to declination in the demand curve slope of the Asian battery manufacturing industry. Some other facts playing behind are the lack of competitiveness of the market participants, consumer tendency to purchase goods at a lesser amount both domestically and internationally, etc. The supply outlook in the Belgium market is also bearish because adequate inventories of the product is available in that region. All the port operations and supply chains are running smoothly without any constraints. In May, the market sentiment dropped further in the domestic market of Belgium due to the lowering of price pressure from the major exporter Chile. Also, the demand strength from the downstream lithium-ion battery manufacturing industry and Energy storage system (ESS) market seemed to be weaker.
In the first quarter of 2023, the market of Lithium Carbonate plunged in the US domestic market. In January, the market prices dropped amidst restricted market activities in the Asian region, and the regional market competition dropped amongst the downstream EV manufacturers. In February, the prices tumbled further amidst a wait-and-see consumer market attitude in the region as the Asian market participants reported a drop in electric vehicle sales and built-up inventories. Whereas in March, due to a decline in new orders and slipping export sales, the market prices of Lithium Carbonate slipped down in the region. Thus, the Lithium Carbonate Battery Grade DDP USGC settled at USD 66208 per tonne at the end of Q1 2023.
In the first quarter of 2023, the offered quotations for Lithium Carbonate dropped considerably in the Chinese domestic market. In the first month of Q1, the prices dropped amid the end of NEV subsidies, so downstream players were cautious about procuring new batches. In the second month of Q1, built-up inventories of Lithium Carbonate were reported in the region. The outlook remained weak, and the market sentiments remained in negative territory due to a drop in electric vehicle sales. In the last month of Q1, the market prices declined further due to high inventories in the region, even though the lithium salt plants reduced production. The demand from the downstream battery manufacturing industries was weak, and the goods were sold at lower prices amidst an oversupply situation. Thus the prices of Lithium Carbonate Ex-Shenzhen settled at USD 47267 per tonne at the end of Q1 2023.
In the first quarter of 2023, the overall market prices of Lithium Carbonate rode the downward trajectory in the Belgian domestic market. In January 2023, the offered quotes plunged, moving identically to the Asian market. In addition, the rising inflation and energy prices kept the operating rates restricted. In February, the prices dropped due to weaker demand from the Asian market players leading to restricted exports of the product and uncertainties regarding the economy. In March, the prices dropped further due to lacking market competitiveness from the Asian markets and the wait-and-see consumer market sentiments across the globe. Thus, the offered quotes for Lithium Carbonate Battery Grade DDP Antwerp settled at USD 66171 per tonne at the end of 2023.