Key Highlights

  • Lithium carbonate fell 1.01% to CNY 92,850 per tonne, down 25.69% over the month.
  • Prices dropped to CNY 100,000 in October, the lowest in nearly ten months.
  • SMM's revised method lifted Chinese stockpiles by 175,000 tonnes, double prior estimates.
  • The EU plans to cap Chinese hybrid imports at 350,000 units a year from 2027.

Lithium carbonate fell CNY 950, or 1.01%, to CNY 92,850 per tonne on Wednesday, Nov. 4, extending a steep monthly slide of 25.69%. The metal remains up 15.34% over the past year, and the data provider's Q4 forecast of CNY 95,605 sits above the current price.

The chart shows lithium carbonate at less than half of a May peak near CNY 200,000. In China, prices slumped to CNY 100,000 per tonne in October, the lowest in nearly ten months, as growing concerns over softer Demand combined with ample supply.

Ample Supply Meets Softer Demand

Inventory data added to the pressure. Industry group SMM changed its methodology for compiling inventory data, which led to a 175,000-tonne increase in Chinese stockpiles, double previous estimates.

Supply is also returning. Mineral Resources restarted the Bald Hill lithium mine following an 18-month suspension, while Core Lithium restarted its Finniss project. Both are Australian producers, and the restarts coincided with a strong outlook for Australian output.

EU Import Cap and Battery Orders

The European Union is set to cap imports of Chinese hybrid electric vehicles at 350,000 units annually starting next year. The European Commission noted that the cap is projected to halve China's Market Share across the bloc.

Battery manufacturers in the region have limited their orders after recent data showed higher-than-expected lithium inventories. Together, the import cap and the inventory revision point to softer near-term buying against a larger visible stockpile.

U.S. Lithium Names

Prices in this market are quoted in Chinese yuan, but U.S.-listed companies track the same supply and demand signals. Albemarle (NYSE:ALB) is one of the world's largest lithium producers, supplying electric vehicle battery makers and energy storage customers.

Lithium Americas (NYSE:LAC) is developing the Thacker Pass project in Nevada, which has a planned Phase 1 output of 40,000 tons per year of battery-grade lithium carbonate. General Motors (NYSE:GM) invested USD 625 million for a 38% stake in the project and holds rights to purchase its output.

Levels and Data to Track

Lithium carbonate's first references are the CNY 100,000 line, which the current price sits below, and the data provider's Q4 forecast of CNY 95,605. The May peak near CNY 200,000 marks the top of the one-year range.

Beyond price, markers include SMM's inventory data and the revised 175,000-tonne increase in Chinese stockpiles, the start of the EU's 350,000-unit hybrid cap next year, order patterns from European battery makers, and output from the restarted Bald Hill and Finniss operations.