Chinese lithium futures fall to almost 10-month low on demand fears

what happened

Chinese lithium carbonate futures fell to an almost 10-month low on Monday. Reuters reported that the most actively traded contract on the Guangzhou Futures Exchange reached 104,680 yuan ($15,640.22) per metric ton, its weakest level since December 17, 2025. It later recovered part of the decline to finish daytime trading 11.8% lower at 104,740 yuan. That was the contract’s sharpest one-day drop since March.

Concern over future demand intensified after China and the European Union agreed on terms that could reduce Chinese hybrid-car exports to the bloc by more than half. EU Trade Commissioner Maros Sefcovic announced the development on Friday following talks in Beijing focused on narrowing the EU’s trade deficit with China. Analysts at Orient Securities said market participants had already questioned the demand outlook. They added that, although the agreement was less negative than earlier fears of higher EU tariffs, Chinese export growth to the bloc would slow afterward.

Lithium prices have been falling since reaching a 33-month high of 209,880 yuan on May 13, and have since lost half their value as concerns about 2027 demand increased. Separately, speculation that CATL could restart its flagship Jianxiawo mine has improved investor sentiment. Shares of major producers Tianqi Lithium and Ganfeng Lithium declined 5.1% and 3.9%, respectively. The exchange rate was $1 = 6.6930 Chinese yuan.

why it matters

The move highlights the sensitivity of battery-material prices to vehicle demand expectations and China-EU trade arrangements. Possible changes to mine operations are also influencing sentiment across lithium producers.

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