CITIC Futures: Supply and demand drivers weaken, lithium carbonate fluctuates and moves sideways

The demand for lithium carbonate at the initial and terminal ends is diverging. Although supply and demand in March remain relatively strong, the future performance of the terminal demand still needs to be observed. In the first quarter of 2026, supply remains relatively robust, despite some companies undergoing maintenance and reducing production, overall remaining at high levels; at the same time, demand is performing well, with downstream companies actively stocking up after price corrections, maintaining a tight supply and demand balance, and social inventories decreasing. The strong demand in March and Zimbabwe’s ban on lithium ore exports have significantly boosted market sentiment, but sales of new energy vehicles in January and February were not optimistic, requiring further validation in March and April, which is critical for the supply and demand balance in the second quarter. If demand for power remains negative in March, there is a high risk that initial demand in April and May will fall short of expectations, and corresponding risks should be carefully managed. In summary, lithium carbonate supply and demand are currently in a tight balance, while Middle Eastern geopolitical events may trigger market speculation on energy alternatives. Zimbabwe’s export ban issue remains unresolved; however, demand from the power sector is not optimistic, and sales in March and April may continue to decline. Therefore, short-term prices are expected to fluctuate, awaiting further catalysts. (CITIC Futures)