Lithium carbonate prices hit record highs

In recent days, the domestic lithium carbonate market has risen rapidly, and the price has repeatedly reached new highs
.
Since October 26, the average price of battery-grade lithium carbonate has continued to rise after breaking through the historical high of 550,000 yuan (ton price, the same below
).
According to data from Shanghai Steel Union, on November 2, the average price of domestic battery-grade lithium carbonate rose to 567,500 yuan
.
The average price of industrial-grade lithium carbonate also rose from 539,000 yuan on October 26 to 554,000 yuan on November 2, setting a new record high
.
At the end of 2021, the highest price of the domestic lithium carbonate market was only 270,000 yuan
.

East Asia Qianhai Securities believes that the quotation of lithium concentrate at home and abroad has risen sharply recently, and the cost of lithium carbonate is strongly
supported.
In addition, the supply of lithium carbonate has decreased, while terminal new energy vehicles are in the peak sales season, and the demand of downstream manufacturers is not decreasing
.
Under the mismatch between supply and demand, the price of lithium carbonate continues to rise
.

From the perspective of raw materials, the quotation of lithium concentrate at home and abroad has risen
sharply recently.
On October 28, Platts Energy Advisory assessed the price of lithium concentrate at $7,700 (FOB Australia), up $600 from the previous week
.
Baichuan Yingfu data shows that on October 27, the spot price of lithium concentrate was $6,600, up $50 from last week
.

At present, China has a high
degree of dependence on upstream lithium resources.
From the perspective of overseas lithium resource companies, the commissioning of Allkem's new phase II project was postponed again, and the output of the MIN mine in the third quarter fell
sharply month-on-month.
Overseas mines are expected to exceed expectations, and the supply and demand of lithium concentrate market is likely to remain tight
.
In addition, on October 24, Australian lithium supplier PLS announced that it had completed the sale of a new batch of 5,000 tons of lithium concentrate, with a transaction price of $7,255, up $155 from October 18
.
This gives a certain guiding effect on the long-term price of lithium concentrate in the future market
.

The development progress of domestic lithium resources is also less than expected, lithium concentrate is still continuing to destock, and the overall supply is tight
.
On the whole, it is expected that the price of lithium concentrate will still maintain an upward trend in the later period
.

From the downstream point of view, since the beginning of this year, the production and sales of new energy vehicles have boomed, and the output of power batteries has also increased
rapidly.
According to the statistics of Fubao Lithium Power Grid, the production and sales of new energy vehicles in China reached 4.
717 million and 4.
567 million units in January ~ September, respectively, an increase of 120% and 110%
year-on-year.
In September, China's power battery output was 59.
14GWh, a year-on-year increase of 155%; In January ~ September, China's power battery production accumulated 362.
9GWh, a year-on-year increase of 169%.

In October, the sales situation of domestic new energy vehicles was generally gratifying, and many new energy vehicle companies delivered more than 10,000 units
.
The impulse of new energy vehicles at the end of the year is expected to increase month-on-month
.
Terminal demand continues to improve, which will support the power battery and lithium carbonate markets
.

From the perspective of supply, with the end of power cuts in Sichuan, lithium salt manufacturers have resumed production from around August 30, and this round of power cuts is expected to affect the production of lithium carbonate in Sichuan about 3240 tons
.
In addition, due to the impact of the epidemic in Qinghai, the shipment progress has slowed down, resulting in a reduction
in the circulation resources of the lithium carbonate market.

"Entering the fourth quarter, Qinghai, Tibet and other places affected by the weather, lithium carbonate production may decline, coupled with the maintenance plan of some enterprises at the end of the year, the uncertainties on the supply side will increase
.
" Longzhong Information lithium battery industry analyst Qu Yinfei analyzed
.

In terms of foreign supply, the world's major exporters of lithium carbonate are Australia, Chile, Argentina and Bolivia
.
Not long ago, three South American countries - Chile, Argentina and Bolivia announced that they want to build a "lithium OPEC" to enhance their dominance in the global supply and pricing of lithium resources
.
If the "lithium triangle" agreement is reached, the release of global lithium carbonate supply increments will be further slowed down
.

For the future market, West China Securities analyst Yan Rong analyzed that domestic salt lakes have begun to reduce production due to cold weather, while downstream manufacturers have rushed to grab volume at the end of the year, and the demand for stocking continues to increase
.
It is expected that the contradiction between supply and demand of lithium carbonate will become more prominent, and prices will continue to rise
in the fourth quarter of 2022 and the first quarter of 2023.

Dongguan Securities and Minsheng Securities also believe that spot supply is in short supply, and the high prosperity of downstream consumption does not change, and lithium prices are expected to continue to rise
.
They are optimistic about the stability
of the development of the lithium plate in the fourth quarter.