Yes I saw that article, it doesnt say the all important - WHY....

Yes I saw that article, it doesnt say the all important - WHY. It does give you a very big hint though. They normally hold 2 months supply, they currently have 4 months. This is a critical statement for a couple of reasons. 1st Lithium has a short shelf life so they dont want to keep stockpiles of it. 2nd Any manufacturer/converter type business knows if you are sitting on Assets it's potentially very detrimental to your profitability. You buy at $10000 tonne, sit on it for too long, the price drops to 9000 tonne and then you need to sell the converted product at the price premium you paid for it (good luck, you will be selling at a loss - note Ganfengs drop in profits on higher product sales).

Why do these 2 points matter! It means the converters got caught out and the current situation is un-expected. Now demand for Lithium is up - refer to increase 20% of revenue for Ganfeng, so it's not a drop in demand. Its NOT over-supply, they just wouldn't have ordered it because it's there, either they couldn't process it, or more likely the next cog in the supply chain the battery manufacturers have held it up.

Lithium from mine to car is about an 18 month supply chain, so whats gone wrong. I think you will find the answer lies in the change in demand on battery quality. Look at JRO (Altura former offtake partner) They went from the fastest growing battery company in China to into administration, because they produced low quality (cheaper) EV batteries. Chinese govt scraped the subsidy on EV about 12 months ago and then re-introduced them but with higher battery LI quality. The market demand for EV is also insisting on longer range and less fires. This caught out either the chemical converters or the battery manufacturers who had to up-specs and re-tool factories.

Most of this is in my opinion only but it matches up with comments from KB about bottlenecks and over-supply will clear by 2020.