Yes, that is another option. Some traders will try to buy lithium from local lithium producers for deiivery if that is cheaper then buying futures contracts ahead of the expiration date. I have seen tweets, some of which were shared here, that talk about how the Guangzhou futures exchange has allegedly added additional warehouses to its system. So that the material that is supposed to be there just changes ownership. And I also read about traders buying material from local producers and 70 % of that material didn't meet the quality requirements. It seems to me that people who are active in this market either already know that there is not enough material to fulfill all these contracts and they have already planned to exit their positions ahead of the expiration date by buying futures contracts or they have the false believe that there would be at least enough material for delivery so that other traders closing the positions would not be enough to drive futures prices up significantly enough ahead of the expiration date so that they themselves can quitely exit their positions without problems. It is like a game of poker. When the expiration date nears people need to start showing their hands and then we will say who made the right bet and who didn't.
