For the Quarter Ending September 2023
In North America, the price of lithium hexafluorophosphate witnessed a decline in the third quarter of 2023, primarily due to reduced demand from downstream industries and built-up inventories of materials in the domestic market. Throughout the third quarter of 2023, the price of lithium hexafluorophosphate in the USA market fell as a consequence of suppressed downstream demand, particularly from the electric vehicle (EV) sector in the Cathode Active Material (CAM) manufacturing industry. Inquiries into the product indicated the presence of high inventories amongst the dealers, although there was an increase in electric vehicle sales. Furthermore, weak investor sentiment prevailed, largely influenced by the sluggish recovery of the Chinese economy. The supply of Lithium hexafluorophosphate in the domestic region was moderate, and there was a slight decline in imports. Additionally, in light of dampened bilateral trade sentiments with China, imports of the product slowed down further. Notably, production costs significantly decreased due to weaker cost support from upstream Lithium fluoride, leading manufacturers to lower their offered quotations.
In the Asia-Pacific region, the price of lithium Hexafluorophosphate witnessed a decline in the third quarter of 2023. This decline was primarily due to low consumer demand from the downstream sector, an accumulation of inventories, and a reduced production rate. During this period, the market prices of Lithium Hexafluorophosphates in China also experienced a drop in the domestic market. This was driven by the prevailing weak demand conditions in the region. Inquiries from the downstream electrolytes manufacturing industries continued to decrease due to an oversupply situation in the market. The overall trading atmosphere was characterized as average, with consumers adopting a cautious buying attitude, primarily making purchases on an as-needed basis. It's important to note that domestic inventories were ample in the region. Regarding supply, raw material availability was sufficient, while in terms of production, the cost support from the upstream Hydrogen Fluoride and Phosphorus Pentachloride market was observed to be stable to low. No major constraints related to the supply chain were reported. As of September 2023, Lithium Hexafluorophosphate prices were assessed at USD 14,350 per metric ton.
The Lithium Hexafluorophosphate market in Europe demonstrated a bearish pricing trend in the third quarter of 2023 due to weak demand from the downstream sector, low import prices, and limited inquiries. In Germany, the price of lithium hexafluorophosphate experienced a consistent decline, largely as a result of a significant drop in demand from battery manufacturing especially in the Cathode Active Material (CAM) manufacturing industry during this quarter, along with subdued consumer inquiries. Deteriorated business sentiments across the European region also contributed to a sustained downward trend in the pricing of Lithium hexafluorophosphate. Battery manufacturers have shown no interest in increasing their orders during the period of third and fourth quarters, opting for cautious purchases, especially in anticipation of further price reductions, and primarily focusing on long-term orders. In terms of supply, the availability of Lithium Hexafluorophosphate was moderate in the European region, with market participants maintaining consistent imports of the product. Furthermore, there have been no reported instances of supply chain constraints or port congestion.
For the Quarter Ending June 2023
In the second quarter of 2023, the Lithium Hexafluorophosphate market in the USA has consistently observed a bearish outlook throughout the quarter instigated by a plunge in the cost support from the feedstock Lithium Carbonate and Lithium Hydroxide. At the start of the quarter, the major manufacturers observed a serious slack in the prices due to the consistent drop in the benchmarking prices of the feedstock Lithium Carbonate. Reflecting a softer market dynamics and a reversal in the prices of the Lithium ore spodumene. However, the prices forecast for the upstream Lithium Carbonate has been slashed to USD 23000 per tonne in August amidst the higher confidence regarding supply in upcoming terms. In addition, the announcement of the Chilean government's intention to nationalize the Chilean Lithium industry impacted every American private player that has their assets in Chile, however in contrary it also presented a lucrative opportunity to capture the investments as the SQM has 79% of their assets allocated in the country as compared to its American counterpart Albemarle that only consists 26% of their total assets in the region. In terms of demand, the North American market witnessing consistent growth in the demand for EV batteries supported due to the sales of EVs in the region. As per the data, nearly 300,000 sales of fully electric vehicles were registered in the USA alone. As a ripple effect, amidst the overall yet contradicting market scenarios the offers for Lithium Hexafluorophosphate were consistently easing and the DDP USGC discussion for Lithium Hexafluorophosphate was assessed at USD 26,452 per tonne during the quarter ending in June 2023.
During the second quarter of 2023, the Lithium Hexafluorophosphate in the Asia Pacific market observed mixed sentiments. The market developments for Lithium Hexafluorophosphate were predominately supported by the consistent fluctuation in the offers for Lithium Carbonate benchmark offers in the domestic market. During the second quarter of 2023, the prices for feedstock Lithium Carbonate has been dropped to the lowest point since the Lithium industry observed a boom, especially after COP 26 while touching USD 12849 per tonne on FOB Qingdao basis in April 2023. However, later in the quarter, the market observed a considerable rebound after the May Day holidays. This market is predominantly supported by the depleting inventories of cathode materials amongst EV manufacturers. Whereas, after undergoing a complex industrial adjustment process, the operational mode of the Lithium Battery manufacturers has become smoother and less volatile. During the first quarter, the Lithium Hexafluoprophsohate market in China entered an off-season period resulting in the demand contractions and the rapid expansion in the midstream or feedstock Lithium Carbonate manufacturing capacities smoothened the supply chain. As a ripple effect, the cost support for the Lithium Hexafluorophosphate has rebounded coupled with the improved demand from the active cathode materials segment in the battery manufacturing facilities in the Chinese domestic market.
In the second quarter of 2023, the Lithium Hexafluorophosphate market in the European market has observed mixed sentiments throughout the second quarter. Initially, at the start of the quarter, the offers were on the lower end as the discussions and arbitrage remained restricted amidst the seasonal off-trend in the far east Asian market. Further coupled with the rapid expansion of the midstream and feedstock Lithium Carbonate and Lithium Hydroxide facilities has smoothened the supply chain. In addition, during April investment in the European Lithium sector has lowered amidst the uncertainties regarding the ongoing offered quotations of Lithium Hexafluorophosphate and the historic plunge in the benchmark offers of feedstock Lithium Carbonate coupled with the Chilean government's intention to national the Chilean Lithium industry. However, the market sentiments improved in the latter half of the quarter as the global demand improved and proportionally impacted the cost support from the feedstock. Whereas despite the ongoing economic difficulties the demand for Lithium Hexafluorophosphate has improved at a slower pace reported by a European source. In addition, the domestic manufacturers in the region have also faced a considerable supply glut for the feedstock Lithium Carbonate as they have to be more dependent on the cargoes from South America and paid premiums for the Asian cargoes amidst the low running inventories in the region.
The Lithium Hexafluorophosphate market showcased a bearish pricing trend throughout the first quarter of 2023 in the US domestic market. In January, the prices remained on a stable level due to wait-and-see sentiments amongst the downstream players, especially after the market activities in China temporarily shut amidst the Lunar New Year holidays. In February, the market prices plummeted amid adequate inventories of the product and sluggish demand for the product from the downstream Cathode Active Material (CAM) manufacturers in the domestic and overseas markets. In March, the prices declined further amidst inflationary pressure and increased interest rates by the central banks, due to which consumer sentiments deteriorated, and the demand outlook remained suppressed in the region. Throughout Q1, the cost support from the upstream Lithium Fluoride was weak in the North American market.
In the first quarter of 2023, the Lithium Hexafluorophosphate market showcased a bearish pricing trend in the Chinese domestic market. In the first month, the prices declined due to curtailed demand from the downstream Cathode Active Material (CAM) manufacturers. As per the market participants, the inventory levels were sufficient to support production throughout the first quarter of 2023. In the second month, the prices continued to drop as the demand outlook remained silent amid a drop in the procurement rates from the CAM manufacturers in domestic and international markets. In the last month, the prices dropped further amid weaker cost support from the upstream Lithium Fluoride. The demand was sluggish amid the wait-and-see attitude of end-use consumers. Thus, the offered quotes for Lithium Hexafluorophosphate FOB Qingdao settled at USD 20103 per tonne at the end of Q1 2023.
In the first quarter of 2023, the overall market prices of Lithium Hexafluorophosphate rode the downward trajectory in the European markets. In January 2023, the offered quotes plunged and moved similarly 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 downstream Cathode Active Material (CAM) manufacturers in the Asian markets leading to restricted exports of the product and uncertainties regarding the economic conditions. 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. Also, the manufacturing PMI fell in March due to a drop in new orders and lower input costs in the European region.