SunSirs: Will Lithium Carbonate Prices Continue to Rise in 2026?

According to the commodity price analysis system of SunSirs, the price of lithium carbonate in 2025 is expected to show a V-shaped trend overall, with prices falling to near the cost line in the first half of the year, and then rebounding and steadily rising in the second half. Looking ahead to 2026, will lithium carbonate continue to break new ground and achieve further success?

2025 Market Review

In the first half of the year, due to oversupply and continuously increasing production capacity, coupled with slow demand growth and the impact of tariff policies, the price of lithium carbonate continued to fall, dropping from 76,400 RMB/ton at the beginning of the year to 58,000 RMB/ton at the end of June, a decrease of 24%. The second half of the year saw a turnaround. First, the tariff war eased, leading to a surge in exports in the energy storage market. Second, anti-overcapacity policies in the new energy industry aimed at eliminating outdated production capacity. Finally, the supply shock caused by the shutdown of mines, represented by Ningde Times' Jianxiawo mine, led to a rapid price increase, reaching a 40% gain in two months. As the Jianxiawo mine closure was finalized, market sentiment subsided, and prices corrected to around 70,000 RMB/ton. Subsequently, in the third quarter, driven by a surge in energy storage orders, the entire lithium battery industry boomed, providing strong support for lithium carbonate prices, which soared to over 100,000 RMB/ton, reaching the highest point of the year.

2026 Supply Side: High growth is expected to continue

1. Domestic lithium resource development continues to advance and is expected to see sustained growth.

In 2025, China's new lithium carbonate production capacity will be approximately 260,000 tons. In 2026, the new lithium carbonate production capacity in China is expected to be 500,000 to 600,000 tons.

Of this, the new production capacity from salt lakes in 2025 will be approximately 60,000 tons.

In 2026, the estimated increase in production capacity is approximately 190,000 tons.

The spodumene segment is expected to add approximately 130,000 tons of new capacity by 2025.

In 2026, China is expected to add approximately 160,000 tons of new lithium carbonate production capacity from spodumene sources.

The mica-based lithium extraction and recycling sector will see approximately 70,000 tons of new capacity added in 2025, mainly concentrated in lithium recycling projects.

In 2026, China's new production capacity for lithium carbonate from mica is expected to be in the range of 150,000 to 200,000 tons, mainly from technological upgrades and capacity expansion of existing enterprises rather than new projects.

2. New overseas production capacity is mainly focused on low-cost projects, driving the consolidation of lithium carbonate production towards lower costs.

In 2025, the estimated new overseas lithium carbonate production capacity will be approximately 197,000 tons, of which South American salt lakes will contribute about 76,000 tons, African lithium mines about 98,000 tons, and Australian lithium mines about 54,000 tons.

In 2026, the estimated new overseas lithium carbonate production capacity is expected to reach 300,000-350,000 tons, mainly from Africa (120,000-150,000 tons), South American salt lakes (70,000-100,000 tons), North America (30,000-40,000 tons), and Australia (50,000-60,000 tons).

Lithium carbonate demand in 2026: Rapid growth driven by energy storage

1. Demand growth for power batteries is slowing down.

In 2025, influenced by factors such as the high penetration rate and large sales base of new energy vehicles, as well as the slow growth of overall automobile sales, the sales growth rate of new energy vehicles is expected to slow down.

From January to November 2025, the total installed capacity of power batteries in China reached 671.5 GWh, a year-on-year increase of 42%.

In 2026, China's power battery installed capacity is expected to be between 680 and 800 GWh, representing a year-on-year increase of approximately 15-25%.

2. Energy storage demand is growing rapidly

In 2025, China's energy storage industry achieved a historic breakthrough, with both bidding volume and installed capacity reaching record highs. Newly installed capacity for the year totaled 151 GWh, a significant increase of 53% year-on-year. Domestic energy storage bidding volume surged to 364 GWh in 2025, a 261% increase compared to the previous year.

In 2026, newly installed capacity is expected to reach 194-265 GWh, representing a year-on-year increase of 30-60%.

3. The overseas energy storage market continues to experience strong growth.

In 2025, the global energy storage market will see 247 GWh of new installed capacity, a year-on-year increase of 23%, and is expected to add 360 GWh in 2026, a year-on-year increase of 33%.

In 2025, domestic inventories decreased, and a tight supply-demand balance is likely in 2026.

In 2025, the Chinese lithium carbonate market is expected to show a pattern of "oversupply in the first half of the year and shortage in the second half," with overall supply and demand being largely balanced or slightly undersupplied (-3,000 to +10,000 tons) for the entire year.  Inventories are expected to continue to decrease by approximately 20,000 to 50,000 tons. It is projected that the market will move further towards a tight supply-demand balance in 2026.

Price Outlook for 2026

Looking ahead to 2026, under conditions of high supply and surging demand, it is expected that my country's lithium carbonate market will move further towards a tight supply-demand balance, with the price center rising to 100,000-150,000 RMB/ton.

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