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Lithium carbonate prices stopped rebounding, can the follow-up stabilization?
2023/6/26
Since this year, the price of lithium carbonate seems to be on a roller coaster, making the market full of variables. Since the end of last year, after surging 600,000 yuan / ton, at the end of April this year, lithium carbonate prices all the way down to about 180,000 yuan / ton, followed by the beginning of the fall back up. Industry discussions on the recent price fluctuations of lithium carbonate are very lively. Lithium carbonate this price increase on the industry chain downstream impact geometry? Can the subsequent stabilization?
Lithium carbonate prices stopped falling and rebounded
According to data released by the Shanghai Nonferrous Metals Network, as of June 7, battery-grade lithium carbonate offer 310,000 yuan / ton. More than 70% higher than the low point in mid to late April this year. What is the driving force behind this round of lithium carbonate prices to stop the rebound?
"The recent return of lithium prices to 300,000 yuan / ton is mainly influenced by three factors." Liu Xiaomin, lithium salt analyst of Fubo Lithium Grid, analyzed to China Energy News, "Firstly, lithium carbonate and lithium hydroxide manufacturers hold up their prices and are in a heavy sentiment to sell, and the market supply circulation is reduced; secondly, since the end of April, the end demand repair has begun to bear fruit, especially in the lithium manganate and energy storage market, and some material plants have some reserve demand in addition to the immediate demand for procurement, plus Traders speculation, but also amplify the market demand; Third, in May, lithium salt plant and lithium ore merchants frequent auctions, pulling up the price of lithium, while with lithium ore prices rise, lithium salt plant cost pressure is obvious, increasing the determination of the lithium salt plant to hold up prices."
"In the battery-grade lithium carbonate reached 300,000 / ton, the material factory and lithium salt plant gaming emotion is obvious, but Naijin lithium salt plant hold up the price, the low price is not out, the material factory can only follow the market high price procurement." Liu Xiaomin further explained that.
Wu Wei, assistant professor at the China Energy Policy Institute of Xiamen University, told China Energy News, "From January to April this year, the growth of new energy vehicle sales slowed down due to the price war launched by fuel car companies, as well as the impact of the auto market in the traditional off-season sales. And driven by the rising lithium prices last year, lithium resource production capacity continued to increase, and the market was oversupplied for a short period of time, driving down the price of lithium carbonate. However, after entering May, new energy vehicle sales began to return to the rapid growth channel, driving lithium demand up, coupled with the decline in lithium prices in the early part of the mines and refineries to stop production, market supply fell, supply and demand rebalance, resulting in a rebound in lithium carbonate prices."
Less impact on downstream car enterprises
Lithium carbonate prices not only directly affect the selling price of lithium batteries, but also affect the cost of new energy vehicle products. It is understood that the battery cost accounts for about 40%-60% of the cost of new energy vehicles, so when the price of lithium carbonate rises, the cost of new energy vehicle production will rise.
Guangzhou Automobile Group Chairman Zeng Qinghong previously said at the 2022 annual results conference, "When the price of lithium carbonate is above 400,000 yuan / ton, there is no money to make for electric vehicles, lithium carbonate prices down to a minimum of 280,000 yuan / ton, it can be a good solution to the problem of profitability of independent brands."
It is worth noting that the price of lithium carbonate showed a rebound, has always claimed to cost pricing Tesla announced two consecutive price increases in early May. Recent lithium carbonate price increases superimposed on the Tesla price increase, whether it will trigger a new round of price increases for new energy vehicles?
Zhang Xiang, director of the New Energy Vehicle Technology Research Institute of Jiangxi New Energy Science and Technology Vocational College, said in an interview with the China Energy News that this round of lithium price increases will not have a large impact on downstream electric vehicle prices. "The rise in lithium prices, after the price conduction, may lead to increased production costs of car enterprises, profits decline. However, car companies will not dynamically adjust the selling price of vehicles because of the rise in lithium prices. At present, only Tesla in the frequent adjustment of prices. Overall, other car companies prices are relatively stable, the whole electric vehicle market prices in a stable state." Zhang Xiang believes that car companies mainly consider the operation and market position, lithium price changes as a secondary factor. For example, the previous price reduction wave set off by Tesla was considered to combat competitors.
Wu Wei pointed out: "The cost increase brought about by the rise in lithium prices is likely to be shared by all parts of the industry chain. Although the price of new energy vehicles may rise, but the rise is limited. In particular, the current high-end models enjoy a higher premium for raw material increases have a certain ability to bear, and prices are expected to see only a small adjustment."
How to maintain the healthy development of the market
When can the lithium price stabilize? Liu Xiaomin believes that "at present, the upstream and downstream game sentiment is strong, lithium prices in the 300,000 / ton above the upward slowdown, the only terminal vehicle demand recovery, will bring a rapid rise in lithium prices, lithium prices in June is expected to remain stable operation, may be a small increase."
For the upstream lithium price rise, what efforts have been made by downstream enterprises? "Downstream capacity to do is to resist the high price, but the lithium salt plant to hold the price, just need to replenish the library can only buy at a high price." Liu Xiaomin said, "I think the lithium salt plant will also give due consideration to the downstream cost pressure, after all, the healthy development of the entire industry chain is the key. We understand that some material factories and core factories are also laying out lithium business, through the purchase of lithium ore or mineral rights cooperation to get lithium ore, to lithium salt factory on behalf of processing lithium salt, as a response to the rise in lithium prices."
So, the policy level, in order to maintain the stability of lithium prices and maintain the healthy development of the market, how should the relevant management departments do?
Wu Wei said, "Maintaining the stability of lithium prices is important to ensure the healthy development of the new energy vehicle industry and achieve the goal of energy transformation. Policy-wise, I have four suggestions. First, increase domestic lithium resource exploration and development to enhance the ability to guarantee the supply of resources; second, accelerate the layout of global resource investment to create a global lithium resource supply chain; third, build a power battery gradient utilization and lithium resource recovery system to create a new energy vehicle circular economy; fourth, establish a lithium resource storage mechanism to protect the market price to maintain a stable range."
Lithium carbonate prices stopped falling and rebounded
According to data released by the Shanghai Nonferrous Metals Network, as of June 7, battery-grade lithium carbonate offer 310,000 yuan / ton. More than 70% higher than the low point in mid to late April this year. What is the driving force behind this round of lithium carbonate prices to stop the rebound?
"The recent return of lithium prices to 300,000 yuan / ton is mainly influenced by three factors." Liu Xiaomin, lithium salt analyst of Fubo Lithium Grid, analyzed to China Energy News, "Firstly, lithium carbonate and lithium hydroxide manufacturers hold up their prices and are in a heavy sentiment to sell, and the market supply circulation is reduced; secondly, since the end of April, the end demand repair has begun to bear fruit, especially in the lithium manganate and energy storage market, and some material plants have some reserve demand in addition to the immediate demand for procurement, plus Traders speculation, but also amplify the market demand; Third, in May, lithium salt plant and lithium ore merchants frequent auctions, pulling up the price of lithium, while with lithium ore prices rise, lithium salt plant cost pressure is obvious, increasing the determination of the lithium salt plant to hold up prices."
"In the battery-grade lithium carbonate reached 300,000 / ton, the material factory and lithium salt plant gaming emotion is obvious, but Naijin lithium salt plant hold up the price, the low price is not out, the material factory can only follow the market high price procurement." Liu Xiaomin further explained that.
Wu Wei, assistant professor at the China Energy Policy Institute of Xiamen University, told China Energy News, "From January to April this year, the growth of new energy vehicle sales slowed down due to the price war launched by fuel car companies, as well as the impact of the auto market in the traditional off-season sales. And driven by the rising lithium prices last year, lithium resource production capacity continued to increase, and the market was oversupplied for a short period of time, driving down the price of lithium carbonate. However, after entering May, new energy vehicle sales began to return to the rapid growth channel, driving lithium demand up, coupled with the decline in lithium prices in the early part of the mines and refineries to stop production, market supply fell, supply and demand rebalance, resulting in a rebound in lithium carbonate prices."
Less impact on downstream car enterprises
Lithium carbonate prices not only directly affect the selling price of lithium batteries, but also affect the cost of new energy vehicle products. It is understood that the battery cost accounts for about 40%-60% of the cost of new energy vehicles, so when the price of lithium carbonate rises, the cost of new energy vehicle production will rise.
Guangzhou Automobile Group Chairman Zeng Qinghong previously said at the 2022 annual results conference, "When the price of lithium carbonate is above 400,000 yuan / ton, there is no money to make for electric vehicles, lithium carbonate prices down to a minimum of 280,000 yuan / ton, it can be a good solution to the problem of profitability of independent brands."
It is worth noting that the price of lithium carbonate showed a rebound, has always claimed to cost pricing Tesla announced two consecutive price increases in early May. Recent lithium carbonate price increases superimposed on the Tesla price increase, whether it will trigger a new round of price increases for new energy vehicles?
Zhang Xiang, director of the New Energy Vehicle Technology Research Institute of Jiangxi New Energy Science and Technology Vocational College, said in an interview with the China Energy News that this round of lithium price increases will not have a large impact on downstream electric vehicle prices. "The rise in lithium prices, after the price conduction, may lead to increased production costs of car enterprises, profits decline. However, car companies will not dynamically adjust the selling price of vehicles because of the rise in lithium prices. At present, only Tesla in the frequent adjustment of prices. Overall, other car companies prices are relatively stable, the whole electric vehicle market prices in a stable state." Zhang Xiang believes that car companies mainly consider the operation and market position, lithium price changes as a secondary factor. For example, the previous price reduction wave set off by Tesla was considered to combat competitors.
Wu Wei pointed out: "The cost increase brought about by the rise in lithium prices is likely to be shared by all parts of the industry chain. Although the price of new energy vehicles may rise, but the rise is limited. In particular, the current high-end models enjoy a higher premium for raw material increases have a certain ability to bear, and prices are expected to see only a small adjustment."
How to maintain the healthy development of the market
When can the lithium price stabilize? Liu Xiaomin believes that "at present, the upstream and downstream game sentiment is strong, lithium prices in the 300,000 / ton above the upward slowdown, the only terminal vehicle demand recovery, will bring a rapid rise in lithium prices, lithium prices in June is expected to remain stable operation, may be a small increase."
For the upstream lithium price rise, what efforts have been made by downstream enterprises? "Downstream capacity to do is to resist the high price, but the lithium salt plant to hold the price, just need to replenish the library can only buy at a high price." Liu Xiaomin said, "I think the lithium salt plant will also give due consideration to the downstream cost pressure, after all, the healthy development of the entire industry chain is the key. We understand that some material factories and core factories are also laying out lithium business, through the purchase of lithium ore or mineral rights cooperation to get lithium ore, to lithium salt factory on behalf of processing lithium salt, as a response to the rise in lithium prices."
So, the policy level, in order to maintain the stability of lithium prices and maintain the healthy development of the market, how should the relevant management departments do?
Wu Wei said, "Maintaining the stability of lithium prices is important to ensure the healthy development of the new energy vehicle industry and achieve the goal of energy transformation. Policy-wise, I have four suggestions. First, increase domestic lithium resource exploration and development to enhance the ability to guarantee the supply of resources; second, accelerate the layout of global resource investment to create a global lithium resource supply chain; third, build a power battery gradient utilization and lithium resource recovery system to create a new energy vehicle circular economy; fourth, establish a lithium resource storage mechanism to protect the market price to maintain a stable range."
For maintaining stable lithium prices, Zhang Xiang believes that it is necessary to maintain a healthy market operation. "Previously, a large number of operators and intermediaries hoarded lithium carbonate, resulting in a crazy increase in lithium prices, which should be managed in a certain way. In addition, lithium carbonate supply and demand information should be released in a timely manner, for example, the current total domestic lithium mineral capacity, the amount of imported lithium ore, industry demand, etc. Market authorities should often regularly release supply and demand information to guide industry practitioners to invest rationally and vehicle enterprises to plan ahead."
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