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Strong rise or short-term stabilization analysis of the reasons for the recent lithium price rise


强势上涨还是短期企稳 近期锂价上调原因剖析

Recently, the price of lithium salt in China has changed. The price of SMM on July 8 showed that the latest quotation of industrial grade lithium carbonate was 32000-37000 yuan / ton, which increased by 500 yuan / ton compared with the low price of the previous trading day, and the average price increased by 0.73%.

According to SMM statistics, since the beginning of the year, the price of battery grade lithium carbonate has fallen by 20.4%, the price of industrial grade lithium carbonate has fallen by 12.7%, and the downward pressure on the price of battery grade lithium carbonate is more obvious.

From the SMM lithium salt inventory data, the current domestic lithium carbonate market as a whole still has a relatively obvious surplus trend. In this context, why did the price of industrial lithium carbonate rise?

SMM believes that this price increase is guided by the active price adjustment of the large industrial lithium carbonate factory in Qinghai, which has tight shipments. At the same time, the supply and demand structure of industrial lithium carbonate has improved, driving the process of small price increases in the industry. At present, there are still some differences between the application scenarios of battery grade lithium carbonate and industrial grade lithium carbonate, resulting in differences in the supply and demand structure of the two. See the specific breakdown:

Industrial lithium carbonate: the price may be raised successfully in the short term, but the risk of future correction is still there

From the supply side:

1. In the second quarter, some smelting enterprises mainly engaged in industrial lithium carbonate in Qinghai and Jiangxi carried out shutdown and technical transformation for about one month, and the industrial carbon supply in the market fell month on month in May and June;

2. With the improvement of lithium salt process technology, the continuous improvement of downstream requirements for lithium salt quality, and the consideration of smelters on product profitability, since the beginning of the year, more enterprises have begun to adjust their production lines to reduce production costs and increase the production proportion of battery grade lithium carbonate, which has led to a corresponding reduction in the supply of industrial grade lithium carbonate in the market. According to SMM statistics, the current market capacity to convert to electricity and carbon is more than 43000 tons.

From the demand side:

1. The lithium iron phosphate Market recovered significantly, and large factories released new production capacity or further stimulated the demand for industrial carbon. At present, terminal vehicle enterprises still have strict cost reduction plans. The purchase of raw materials by midstream material factory is gradually cost-oriented, and more lithium iron phosphate enterprises begin to actively match Salt Lake industrial carbon. According to SMM research, the output of lithium iron phosphate material enterprises recovered significantly in May, and the monthly output returned to more than 10000 tons, an increase of 35% compared with April. With the downstream battery enterprises actively preparing goods for the upcoming new models of lithium iron phosphate, the output of lithium iron phosphate was still increasing in June and July. In addition, after the German nano's plant in Qujing, Yunnan is put into operation, it may further stimulate the demand of the industrial carbon market in the second half of the year.

2. There is a long-term price difference between electric carbon and industrial carbon, and the demand of purification enterprises increases. This year, due to the impact of the epidemic, the market demand has been greatly reduced, and the price of lithium salt has fallen all the way. However, due to the cost support of spodumene price on electric carbon, the price decline began to slow down after the electric carbon fell below 40000 yuan / ton; However, Salt Lake industrial carbon has a certain cost advantage. In order to reduce the shipment price significantly, the price difference between the low price and the price of electric carbon is more than 6000 yuan / ton, which has been maintained for a period of time. Considering that the price difference between the two can cover the processing costs of some deep-processing enterprises, and based on the demand for cost reduction at downstream terminals, some lithium carbonate purification and processing enterprises resumed production in June, increasing the demand for industrial carbon procurement.

3. Demand for lithium manganate slowly recovered, and some hoarding occurred in the industrial sector. There is strong demand from large manufacturers of domestic electric bicycle battery supply. At the same time, with the gradual opening of the overseas market, the export orders of small power batteries have gradually resumed. According to SMM research, the output of lithium manganate increased by 18.9% month on month in June, and the procurement demand of lithium manganate enterprises increased; In addition, when the low price of 30000-31000 yuan / ton appeared in the industrial lithium carbonate market, some industrial enterprises began to increase the purchase of industrial carbon.

From the perspective of both supply and demand, the supply and demand structure of industrial lithium carbonate has been significantly repaired since May. In addition, Qinghai lithium salt plant, which has concentrated some downstream customers, took the lead in raising the price before the market faced tight shipments; When the market demand improved and the inquiry increased, the rest of Qinghai lithium salt enterprises took advantage of the trend to support the price.

Battery grade lithium carbonate: it is difficult to follow up, but in the long run, the bottom of the price has appeared

From the supply side:

The demand of purification enterprises has increased, and the supply pressure of battery grade lithium carbonate has increased. Although some spodumene lithium extraction enterprises have reduced production due to increased cost pressure since the beginning of the year, the current domestic battery grade lithium carbonate supply market is facing the pressure of some smelters with mica and salt lake brine as raw materials to switch to carbon, on the other hand, it is also facing the competition caused by the increase of short-term purification enterprise supply, and the supply pressure is rising. In addition, the increase in imports of lithium carbonate has also exerted significant pressure on domestic supply.

From the demand side:

1. The demand for conventional ternary materials recovers slowly, and the purchasing power of material factories is limited. Although the production scheduling plan of leading battery enterprises increased significantly in July, the demand support for battery grade lithium carbonate in the ternary material market is still limited. On the one hand, the recovery of the overseas new energy vehicle market mainly drives the export of high nickel batteries, thus increasing the recovery of lithium hydroxide demand. For the conventional ternary market, except for the small increase in the demand for ternary materials in some digital markets, there is no obvious sign of demand increase in the power market; On the other hand, at present, domestic material factories still have some semi-finished products and finished products in stock, and the purchasing power of raw materials is limited.

2. Part of the demand market was eroded by industrial grade lithium carbonate due to the downstream cost reduction requirements. With the progress of enterprise technology, the current industrial grade lithium carbonate product quality has gradually improved, and the matching degree between material factories and different types of lithium carbonate has also increased. As a result, in the current cost oriented market, the previous quality threshold of battery grade lithium carbonate with spodumene as raw material is constantly decreasing, the types of raw materials that enterprises can choose are increasing, the market competition is more intense, the application scenarios of industrial grade lithium carbonate are increasing, and it is more difficult to ship battery grade lithium carbonate.

On the whole, the current supply and demand structure of battery grade lithium carbonate is not ideal, the pressure of enterprise inventory is obvious, and it is difficult to follow up the price.

Although in the short term, the price adjustment of industrial lithium carbonate may be a point-to-point process, and all industrial carbon enterprises are currently in a wait-and-see state to the market, and are eager to increase the price, there is still a certain risk of decline in lithium salt prices in the future:

On the one hand, imported lithium carbonate from abroad still has certain pressure on the domestic supply market; On the other hand, although the current inventory level of major industrial carbon manufacturers is low and the shipment situation is good, some manufacturers are still facing high inventory pressure, and the short-term price may be successfully raised due to the improvement of the supply and demand structure of industrial carbon. However, it does not rule out that some enterprises may sell goods at low prices due to their own cash demand.

In the long run, there is still a high correlation between the prices of industrial grade lithium carbonate and battery grade lithium carbonate, and the industry needs some time to digest the inventory. At the stage when the price of lithium carbonate is already in the bottom range, whether there is an opportunity for trend increase in the price in the future needs to closely observe the emergence of the inflection point at the demand side.

Article source:Battery net

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