Lithium prices will likely head lower this half as supplies improve
However, energy storage demand is likely to hold prices from any sharp fall despite China ending tax sops on EV batteries
Lithium prices are expected to decline during the current half of the year due to improved supplies, although energy storage demand is anticipated to prevent any significant price drop, according to industry analysts. The cost of lithium carbonate, a crucial chemical compound for EV batteries, fell to a six-month low of 140,000 Chinese yuan ($20,770) per tonne due to concerns over reduced consumption and increased global supply.
Prices have since rebounded by around $1,000 in recent days. China has announced the end of tax exemptions for lithium-ion batteries, which may impact manufacturing and pricing strategies. Despite this, BMI, a research agency under Fitch Solutions, has revised upwards its 2026 average annual lithium price forecasts for Chinese lithium carbonate and hydroxide.
Lithium hydroxide, another critical compound in EV battery production, is also anticipated to see a downward trend this half, as Chinese supply resurges and Australian projects restart, putting downward pressure on prices. Global fuel costs due to the conflict in the Middle East may spur higher EV adoption, but the extent of this impact on lithium demand remains uncertain.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
