Uncertainty over CATL lithium mine restart could fuel price volatility: analysts

CATL, the world's largest lithium-ion battery producer, faces uncertainty over the restart of its Jianxiawo lithium mine in Yichun, Jiangxi Province. Analysts warn this uncertainty could cause volatility in lithium prices during the fourth quarter, as the mine accounts for roughly 4 to 5 percent of global supply when operating at full capacity.

The mine's operations were suspended in August 2025 when its mining permit expired, but analysts expected a late September restart following the approval of a safety-production permit on June 29.

The recent hold-up in restarting production has yet to significantly impact domestic lithium carbonate prices. However, it may become a factor during the fourth quarter. Analyst Xiao Jiaying from Orient Futures explains that multiple lithium mines are undergoing mining-license conversion procedures, adding to the uncertainty in the supply outlook for Q4.

Meanwhile, market participants agree that lithium carbonate demand remains strong, with domestic stockpiles at multi-year lows. Cinda Futures analyst Lou Jiahao predicts a potential rebound in prices if demand increases by 5 percent month-on-month and inventory drawdown continues, despite the unresolved risks surrounding the Jianxiawo lithium mining project.

Lithium carbonate futures contracts on the Guangzhou Futures Exchange have risen over 30 percent year-to-date, trading above 150,000 yuan (US$22,312) per tonne. This price surge benefits industry participants, with global battery materials leader Tianqi Lithium reporting record-high revenue and profits in the first half of the year, driven by demand for its lithium products in the new-energy sector.