PMT Megathread, page-1454

• Downstream demand yet to improve
• Lithium hydroxide spot market slow

The Chinese lithium market was rangebound Dec. 29 amid tepid demand and spot activity revolving around futures delivery.

Platts assessed battery-grade lithium carbonate at Yuan 95,000/mt on a DDP China basis Dec. 29, up Yuan 1,000/mt on the day and down Yuan 1,000/mt on the week.

The tradable range for battery-grade lithium carbonate was wide, fluctuating around Yuan 90,000-100,000/mt. "Offers are based on the 2407 futures contract with a certain discount, we can see very different offer prices within a day," a trader said.

However, producers were giving lower tradeables as compared to traders, citing that downstream demand was not great. "The real demand from downstream consumers excluding speculating element is not that good," a market source said.

Bids for lithium carbonate long-term contracts were heard at index calculation minus a 10%-12% discount, while producers were offering a 5%-8% discount. "Consumers are really cautious in terms of negotiation and it is hard to get a deal done now," a second market source said.

"Downstream demand is really bad for both LFP and NMC, they received fewer orders," a separate market source said. "The problem is not only about oversupply but also weak demand from the consumers," the source said.

Platts assessed battery-grade lithium hydroxide at Yuan 88,000/mt DDP China basis on Dec. 29, down Yuan 1,000/mt on the day and Yuan 2,000/mt on the week. Offers were heard below Yuan 90,000/mt.

Lithium hydroxide supply from traders was lesser due to bearishness. "It is even harder to trade lithium hydroxide, we need high logistic requirements and hazard certificates, it is not worth it to focus on lithium hydroxide," a separate trader said.

The downstream demand was tepid. "Cathode material factories are not buying, it was all traders," a producer said. "Some smaller downstream factories are buying little stocks occasionally, like 10 mt per trade, only on a need basis," another trader said.

Upstream, Platts assessed spodumene concentrate with 6% lithium oxide content at $970/mt FOB Australia Dec. 29, down $30/mt on the week.

Sporadic offers were heard for Australian spodumene at prices around $1,100-$1,300/mt. "Miners are mostly selling based on term contracts, but they will also ask big trading companies to help them sell in the spot market," a separate trader said.

However, the tradeable for spodumene was heard lower than $1,000/mt, based on the backward calculated prices from the lithium chemical salts.

Platts is part of S&P Global Commodity Insights.