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Platts China Lithium Assessment

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• What are Platts China Lithium price assessments?
• How do we assess Platts China Lithium prices?
• Platts China Lithium Commentary
  • • Power restrictions lifted in Sichuan
    • Production ramp up expected to take weeks
    • Supply disruption expected to continue in Qinghai, Sichuan provinces
    
    
    Chinese battery-grade lithium carbonate was heard to have changed hands at prices as high as Yuan 520,000/mt in the week to Sept. 2, as production continues to lag even after the resumption of power in Sichuan province and COVID-19 restrictions in Qinghai kept brine supply tight.
    
    Platts assessed battery-grade lithium carbonate at Yuan 500,500/mt Sept. 2 on a delivered, duty-paid China basis, up Yuan 9,500/mt on the week.
    The uptrend in prices is expected to continue, with market participants expecting a time lag for production to restore to full capacity amid disruptions from COVID-19 curbs.
    "Lithium exports have been affected and its delayed due to Covid-19 in Sichuan area. Production would also take about 2 weeks to ramp up after being affected by the power cuts," a Chinese trader said adding that market was likely to move higher in the short term.
    Spot liquidity in the market has recovered with multiple trades heard in the week to Sept. 1 as higher prices enticed more spot offers from suppliers. Supply uncertainties also contributed to the bullish demand.
    Traded levels climbed higher to Yuan 490,000-520,000/mt, though Yuan 520,000/mt was deemed to be an outlier by most market participants, who pegged tradable levels generally around Yuan 500,000/mt.
    Restrictions in Qinghai, where Chinese brines operate, were expected to continue with the COVID-19 situation "worsening", affecting logistic and transportations though production was yet to be impacted, market sources reported.
    “Even though power returned, there is still Covid restrictions. Looking at the potential disruptions, expecting prices to increase and be supported in Q4," a producer shared.
    Market participants largely echoed bullish sentiments, with demand expected to rise into peak season providing further support to lithium prices amid an already tight market.
    Lithium hydroxide prices have risen along with lithium carbonate prices albeit more modestly as spot liquidity remain largely muted, according to sources.
    Platts assessed battery-grade lithium hydroxide at Yuan 483,500/mt Sept. 2, on a delivered, duty-paid China basis, up Yuan 3,000/mt on the week.
    Lithium hydroxide remained relatively stable as spot requirements outside China remained muted coupled with limited spot demand, a Chinese trader said.
    Platts assessed spodumene concentrate with 6% lithium oxide content (SC6) at $6,400/mt FOB Australia Sept. 2, up $60/mt on the week.
    Market sources expected prices to stay rangebound as tight market fundamentals is expected to support prices at levels to that of the industry’s last auction prices, pegging tradeable levels in the range of $6,300-7,000/mt CIF China.