The main contract of lithium carbonate futures on December 17th showed a strong performance throughout the day, with significant characteristics of wide-range consolidation and one-sided rise.

The Choice data shows that the contract opened at 101,500 RMB/ton and continued to rise in the morning, reaching a high of 109,860 RMB/ton during the day, with significant intraday fluctuations.

Supply side: Policy rectification, overseas risks and delayed resumption of production contribute to uncertainty.

Huatai Futures Research Report pointed out that the current uncertainty in the supply side is one of the key factors supporting the strong price of lithium carbonate, with a continuous stream of supply disruptions at home and abroad.

Domestically, the Yichun City Natural Resources Bureau of Jiangxi Province announced on December 12th that it plans to cancel 27 expired mining permits, involving key mining areas such as the Wuoqiao Kaolin Mine in Gaonan City, with 17 of them being kaolin mines. Zhongxin Futures Research Report analyzed that although the 27 mining rights permits that are about to be announced for cancellation have expired, the actual impact on the supply of lithium carbonate may be limited. However, its deeper significance lies in clarifying the boundaries of kaolin and lithium mine permits, marking a new stage in Yichun City's rectification of mineral resources management order, and its move towards strategic mineral resources security and green sustainable development.

Potential overseas risks have also emerged. Recently, 19 states in northern Nigeria planned to push for a complete suspension of all mining activities for six months to address the security challenges posed by illegal mining. Cofco Futures Research Report analyzed that the area serves as the core hub for lithium mining and processing plants in Nigeria. If the mining suspension lasts for 6 months, it will have a significant impact on the subsequent supply of lithium from Nigeria to China. The research report also warned that the event still needs to be approved by the president, and although it may trigger short-term supply fluctuations, combined with Nigeria's support for Chinese investment and the recent trend of import growth, short-term disruptions are unlikely to change its long-term growth direction for exports to China.

In addition, the existing capacity release has not met expectations. The research report of Huaxi Futures pointed out that although the production of lithium carbonate has been steadily increasing in recent months, the weekly capacity utilization rate is at a high level, and the market generally expects that the production in December will continue to grow, the actual resumption of production of major lithium mines (such as Jiayangwo) has not met the previous expectations, and the overall supply increase is limited.

Demand side: Dual-wheel drive of new energy and energy storage, and the continuous decline of inventory confirms strength.

While supply continues to face uncertainties, the growth momentum on the demand side provides another major support for the market. According to a research report by Dongwu Futures, the output of new energy vehicles reached 12.992 million units from January to October 2025, a year-on-year increase of 33%. During the same period, the cumulative production of power battery cells was 98.59 GWh, a year-on-year increase of 44%. The storage market has grown even more rapidly, with global storage battery cell shipments increasing by 98.5% year-on-year to 41.045 GWh in the first three quarters of 2025, and the cumulative production of domestic storage battery cells reached 40.94 GWh from January to October, a year-on-year increase of 55%.

At the same time, the market is optimistic about the demand for energy storage next year. Yangguang Power, a leading company in the energy storage sector, estimated at its third-quarter earnings conference in 2025 that the global energy storage market will maintain a high growth rate of 40%-50% in 2026. According to a report by Dongwu Futures, if the growth rate of energy storage exceeds 40% in 2026, the demand for lithium carbonate could reach 5.23 million tons, which would significantly improve the supply and demand balance of lithium carbonate.

Driven by strong demand, lithium carbonate has shown a continuous trend of inventory reduction. According to the latest data from SMM, the spot inventory is 111,469 tons, a decrease of 2,133 tons compared to the previous month. Among them, the inventory of smelters is 191,61 tons, a decrease of 16,06 tons compared to the previous month; the inventory of downstream users is 42,738 tons, a decrease of 9,57 tons compared to the previous month; and other inventories are 49,570 tons, an increase of 4,30 tons compared to the previous month. Huatai Futures research report points out that the inventory of downstream users and smelters has decreased, while other inventories have increased. It is expected that the overall trend will still maintain inventory reduction in December, but the inventory reduction has slowed down. Attention needs to be paid to whether there will be a turning point in inventory at the end of the month or in December.

The Cofco Futures Research Report analysis believes that the lithium carbonate market in 2025 will show a "strong demand and supply" pattern, but the year-on-year growth rate of supply will be lower than demand. In the context of the supply release cycle not yet fully ending, combined with the strong demand expected in 2026, the elasticity of the supply side may be further amplified. In the short term, the mismatch between supply and demand may support the price to maintain a high-level fluctuation, and it is necessary to closely monitor the pace of marginal supply release.

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