The most-traded GFEX lithium carbonate contract created a year-to-date low yesterday, with an intraday decline of 11.79%, with the market holding a bearish outlook toward the demand end. On the one hand, Goldman Sachs' global metals and mining research team released a report projecting that the global lithium market will shift from a 404,000-tonne supply deficit in 2026 to a 444,000-tonne surplus in 2028, and sharply cut its 2027 China lithium carbonate spot price forecast to about RMB 100,000/tonne.
Elsewhere, there was news that China and the EU have just reached an understanding on hybrid vehicle trade, with the EU planning to cut imports of Chinese hybrid vehicles by about half through trade safeguard measures. Domestically, there was rumor on the market that some battery cell plant has reduced their production scheduling for Q4, triggering concerns for future demand. Nonetheless, the near-term fundamentals have remained resilient with sustained lithium carbonate inventory destocking, though it has been overlooked by prevailing pessimism over future demand. It is likely that the lithium carbonate prices will hover low in the near term.
