Price trend

According to data from the SunSirs' commodity market analysis system, on November 4th, the continuous rise in lithium carbonate prices came to a halt. The benchmark price for battery-grade lithium carbonate on the SunSirs was 80,200 RMB/ton, and the benchmark price for industrial-grade lithium carbonate was 78,433 RMB/ton, ending the previous upward trend of over 10% from 73,016 RMB/ton (October 16th) to 80,700 RMB/ton (November 3rd).

The core reason for the pullback: Supply-side rumors disrupted market confidence

The direct cause of this price correction was market news that CATL's Jianxiawo project had resumed production ahead of schedule. Although there was no public announcement of substantial progress on the project, the expectation of its resumption directly impacts market assessments of the supply structure. As of Novermber 4, the monthly inventory reduction in the lithium carbonate market was 8,000-10,000 tons. If the project resumes production ahead of schedule, the new capacity may reverse the short-term inventory reduction trend, triggering a price correction.

Core fundamental support: Explosive growth in energy storage demand

In October, the combined production of power, energy storage, and consumer batteries in the Chinese market reached 186 GWh, a 22.4% increase month-on-month and a 45.3% increase year-on-year. As of Novermber 4, leading battery manufacturers were operating at near full capacity, with some companies having orders booked until early next year. Both upstream and downstream industries were running at full capacity. Downstream production is expected to continue its month-on-month growth in November, with better-than-expected performance during the off-season supporting a continued positive fundamental outlook.

The trend of continuous inventory reduction continued

The industry has been destocking for 11 consecutive weeks, with total inventory decreasing by approximately 16,000 tons. As of the week ending October 30, weekly lithium carbonate inventory was approximately 127,000 tons, a decrease of over 3,000 tons week-on-week, indicating a further acceleration in destocking. Specifically, smelter inventory decreased to 32,000 tons, downstream inventory decreased to 53,000 tons, and trader and other inventories totaled 42,000 tons.

Market outlook

According to analysts at SunSirs, the supply-side "weak expectations" for lithium carbonate are offset by the "strong reality" of the fundamentals. The supply-demand relationship is expected to change only slightly in November, exhibiting a wide range of fluctuations. Further attention should be paid to project resumption information and changes in market supply and demand.

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