Lithium carbonate prices in China fell to CNY 563,500 per tonne,...

Lithium carbonate prices in China fell to CNY 563,500 per tonne, the lowest in seven weeks and 6% below the record-high of CNY 597,500 touched in November amid expectations of lower demand and hopes of steady supply, raising the possibility that the lithium market could swing back to a surplus in 2023. Chinese authorities are set to cancel new energy subsidies for battery manufacturers in January, significantly driving down demand for the key input material. At the same time, local Chinese governments will likely halt cash subsidies for citizens purchasing electric vehicles, expected to significantly slow sales in the world’s top consumer. On the supply side, mining giants continued to secure contracts in Australia and South America to offset bottlenecks in China. Still, decarbonization goals in China and a wave of electric vehicle sales drove lithium prices to soar 103% year-to-date, despite its pullback since mid-November.