Lithium carbonate spot prices fluctuate downward

Today, the spot price of battery-grade lithium carbonate from SMM saw choppy declines compared with the previous working day, and the futures board’s main contracts moved down in tandem. After the market opened, the price briefly pushed up to above 170k yuan/ton, then declined steadily amid ongoing fluctuations, and ultimately closed at 157k yuan/ton. Open interest trended toward position reductions throughout the day; by the close, it was down by about 20k lots versus the prior trading day. Notably, the gap in open interest between the 2605 contract and the 2609 contract has narrowed to just 10k lots.

In the spot market, upstream lithium-salt producers’ quotations have continued to stay above 165k yuan/ton. However, as prices keep falling, upstream sellers’ willingness to hold back has increased, and actual shipment willingness has weakened. By contrast, downstream materials producers’ procurement demand has not shown a clear rebound. As long-term contract volumes and customer-supplied quantities arrived one after another at the beginning of the month, along with replenishment purchases made early in the week on dips, downstream materials producers’ inventories at the start of the month are relatively well-stocked. As a result, replenishment procurement appetite is weak; some of the purchases are only for essential needs, and some are conducted via delayed pricing. Overall, market inquiries have been relatively active, but actual deals have been somewhat subdued. On the supply side, repeated rumors and reports about Zimbabwe have been fermenting and have become an important trigger for today’s continued drop in lithium carbonate prices. Some funds have chosen to close positions and exit. However, given current Middle East geopolitical volatility and ongoing disruptions on the supply side, it is expected that in the short term lithium carbonate prices will still maintain a relatively strong, choppy trading pattern. (SMM)