While the lithium carbonate prices pulled back significantly post the introduction of consumption tax on lithium-ion batteries earlier last week, the prices re-claimed some of the losses in the second half. Mysteel's tracking indicated that the spot transactions remained subdued, mainly because the downstream consumers had built ample inventories during the recent price decline, leaving a significant portion of lithium carbonate stocks accumulated downstream. As a result, despite lower absolute prices, downstream demand for spot purchases has remained weak.
On the production front, August is expected to see weaker supply and stronger demand, with the balance sheet pointing to a significant drawdown. Lithium carbonate prices are likely to rebound after fully digesting the recent bears.
