Lithium Carbonate Climbs 11% From July Lows as CATL's Jianxiawo Restart Stalls
Key Takeaways
- •The most active Guangzhou lithium carbonate contract closed at 152,500 yuan per tonne on Wednesday, up 11% from July's lows.
- •CATL suspended mining at Jianxiawo, one of the world's largest hard-rock lithium assets, in September 2024 amid falling prices.
- •The mine's restart remains delayed by licensing and regulatory processes, tightening spot lithium carbonate supply in China.
- •The timing of Jianxiawo's return to production is a key swing factor for global lithium balance amid growing EV battery demand.
- •Fitch Ratings and other analysts caution the rally may have outrun fundamentals, with supply expected to remain ample over the longer term.
The most active lithium carbonate contract on the Guangzhou Futures Exchange closed at 152,500 yuan (about $22,500) a tonne on Wednesday, up 11% from July's lows, as the stalled restart of CATL's giant Jianxiawo mine keeps a floor under the market.
Jianxiawo, part of CATL's lepidolite operations in China's Jiangxi province, is one of the world's largest hard-rock lithium assets. CATL suspended mining there in September 2024 as lithium prices slumped, and the restart has since been tied up in licensing and regulatory processes, tightening spot supply of lithium carbonate in the Chinese market. With demand from electric-vehicle battery production continuing to grow, the timing of the mine's return to output is a key swing factor for the global lithium balance.
The rebound also comes after a prolonged downturn in which lithium prices fell sharply from their late-2022 peaks, forcing producers across Australia, China and elsewhere to curtail output and shelve expansion projects. Analysts, including Fitch Ratings, have cautioned that the recent rally may have outrun fundamentals, with supply remaining ample on a longer horizon.
Source: The Northern Miner (full article available to members).
