The lithium carbonate futures price remained soft last Friday, closing the day session with palpable decline. On the one hand, the overseas mining companies released their Q2 earnings report intensively toward end-July, suggesting smooth progress or ramp-up of production, reinforcing the expectations of rising supply in the future or 2027. Yet, the fudamentals were firmly resilient, with inventory continuing to destock across the industry chain.
On the fundamental side, spot buying picked up below Yuan 140,000/tonne, though the pace of warrant cancellation remained relatively slow. On the demand side, LFP producers reported strong orders in August, maintaining a steady production ramp-up with a 5% month-on0month increase in production schedules. While July and August are expected to see a significant drawdown in lithium carbonate inventories, market sentiment toward the sustainability of future demand remains pessimistic, with concerns that supply growth driven by elevated valuations will outpace demand growth. Therefore, it is expected that the lithium carbonate prices will keep rangebound in the near term.
