Lithium Prices in China Sink Toward a 10-Month Low

what happened

Trading Economics reports that lithium carbonate in China traded at CNY 115,000 per tonne in October, the lowest level this year. The decline reflected softer demand and fresh signs that supply remains ample.

From next year, the EU plans to restrict annual imports of Chinese hybrid electric vehicles to 350,000 units. The European Commission said the measure should cut China’s share of the bloc’s market by half, reducing orders from regional battery makers. That pressure follows data showing lithium inventories above expectations.

SMM, an industry group, revised its inventory methodology, adding 175,000 tonnes to Chinese stockpiles—twice the earlier estimate. Australian supply prospects also strengthened after Mineral Resources resumed the Bald Hill mine following an 18-month suspension, while Core Lithium brought Finniss back online.

why it matters

For lithium markets, weaker demand, higher inventory estimates and the EU’s planned limit on Chinese hybrid-vehicle imports point to added pressure on consumption. At the same time, the restarts at Bald Hill and Finniss indicate that Australian producers are returning capacity after extended interruptions. Together, the developments add to the market’s focus on the balance between battery-sector orders, inventories and available supply.

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