10 months surge of 120%! Lithium prices reach a crossroads—how should industry chain companies respond?

Ask AI · How can companies in the industrial chain respond to the risk of lithium price volatility?

《Science and Technology Innovation Board Daily》April 6 News (Reporter Wu Xuguang) The global lithium market has reached a critical crossroads.

In recent days, lithium carbonate futures prices have continued to decline. As of April 3, the main contract closed at 156,960 yuan/ton, down 1.42%.

Industry insiders believe that the short-term pullback in lithium carbonate prices is mainly triggered by renewed disturbances on the lithium supply side. Recently, the market reported that Minmetals Resources has obtained export quota for Zimbabwean lithium concentrate.

In response, a staff member from the securities department of Minmetals Resources told reporters from 《Science and Technology Innovation Board Daily》 that the company is currently still communicating with the local government in Zimbabwe, and some progress has been made. However, there is no clear timeline as yet. The market generally expects that the relevant export implementation details are likely to be finalized in April.

Even if there are positive expectations of policy easing in the market, the core overall pattern of global lithium supply still being relatively tight has not fundamentally changed. At present, the industry has reached a broad consensus that supply and demand in the lithium market are tightening.

Morgan Stanley predicts that in 2026 the global lithium market will face a shortage of 80k tons of lithium carbonate equivalent, while UBS predicts the shortage will be 22k tons; UBS also states that in 2026, global lithium demand growth will be 14%, and will further rise to 16% in 2027.

▍ Lithium carbonate raw material prices continue to rise

Against the backdrop of a contraction in global lithium mine output, market attention has focused on the trend of lithium carbonate prices. According to data statistics from the third-party institution Mysteel, as of April 3, the spot quotation for battery-grade lithium carbonate was 158,000 yuan/ton. Compared with the price level of 60,000–70k yuan in the second half of 2025, it has already achieved more than a 1.2x increase.

Regarding this price trend, Zhang Qian (a pseudonym), a senior analyst in Shanghai’s lithium industry, told reporters from 《Science and Technology Innovation Board Daily》 that current battery-grade lithium carbonate prices are showing an unusually strong performance. The rise in prices this round is mainly driven by concentrated surges in demand from 2025 Q4 energy storage and the new energy vehicle market, together with disturbances in policies at the mine end.

On the demand side, one engine driving lithium demand growth is electric vehicles, and the other “second growth point” pulling lithium demand is energy storage. In China, downstream demand for lithium batteries has already shown clear signs of recovery. Industry data shows that in March, the total production scheduling volume in China’s lithium battery market was about 219 GWh, up 16.5% month over month. The share of energy storage battery cell production scheduling increased to 40.6%, a noticeable rise compared with the beginning of the year.

On the supply side, a pattern of both growth and risk is emerging. On the one hand, large lithium projects in Australia, Africa, and South America are gradually coming online and ramping up, becoming a key source of global incremental supply. On the other hand, factors such as operational risks triggered by geopolitical turmoil, policy changes in resource countries, and tightening environmental and regulatory policies will still cause ongoing disturbances and uncertainty to actual supply.

Against this backdrop, regarding the outlook for lithium carbonate prices in the second quarter and subsequent trends, Zhang Qian further analyzed and said that there are still many disturbance factors in the lithium carbonate market in the second quarter. Focus should be placed on the demand boost from new car launches in April, as well as the lithium mine supply and logistics transportation situation in Zimbabwe and Australia.

“Based on综合 judgments of various factors, uncertainty in the lithium carbonate market in the second quarter is high. If restrictions on lithium mine exports in related companies in Zimbabwe persist, they may face inventory pressure at the mine end, which in turn could affect lithium carbonate output. Overall, the fundamentals of lithium carbonate supply and demand in the second quarter will still remain relatively tight, and prices will maintain a generally strong sideways-to-firm oscillation trend. The specific upside magnitude will depend on dynamic changes in the factors mentioned above.” Zhang Qian added.

According to Mysteel’s forecast, the core price fluctuation range for lithium carbonate going forward is expected to remain between 130k and 170k yuan/ton.

▍ Response strategies by companies in the lithium battery industry chain

The increase in lithium prices and the tightening of supply have been fully transmitted across the entire industry chain. Cost pressure on midstream material companies, order structure, and business strategies have all adjusted accordingly.

It is understood that lithium battery materials are mainly concentrated in the upstream lithium resources and four major midstream core materials: cathode materials, anode materials, electrolyte, and separators, among other links.

For upstream raw material supply and price changes such as lithium carbonate, reporters from 《Science and Technology Innovation Board Daily》 recently contacted multiple listed companies in the industry chain to verify details. It was learned that each company responds to volatility in the raw material market through measures including resource allocation, procurement management, price transmission, and technological iteration.

In the cathode materials sector, Xiamen Tungsten New Energy has stepped into ternary materials and lithium iron phosphate business in sequence.

When discussing how to deal with operational risks caused by tight lithium carbonate supply, a staff member from the securities department of Xiamen Tungsten New Energy said that most of the company’s raw material procurement comes from domestic sources, and both production and operation and raw material procurement are maintained normally. In addition, the company’s lithium iron phosphate capacity has already been released, mainly applied in the field of power batteries.

It is known that Xiamen Tungsten New Energy began building a lithium iron phosphate production base in Ya’an, Sichuan in 2021, and it has already started bulk supply.

Reporters from 《Science and Technology Innovation Board Daily》 noted that currently Xiamen Tungsten New Energy has relatively sufficient inventory. By the end of the third quarter of 2025, the total of its raw materials, work-in-process, and inventory goods was 4.569 billion yuan, and the high level of inventory, to a certain extent, smooths the impact caused by volatility in raw material supply.

Regarding the upstream lithium carbonate price increases, the staff member from the securities department of Xiamen Tungsten New Energy said that in the company’s power battery field, the difficulty of price transmission is relatively high, and downstream buyers are more sensitive to price. The company needs to have the basis for price negotiations through upgrades in product performance. “Currently, the company continues to advance technological iteration, improve product performance and cost-effectiveness, and enhance market competitiveness. After downstream customers complete testing and verification, then negotiate about price increases.”

For the upstream tightening of lithium carbonate raw material supply, a person from the board secretary office of Dofalu Nano (德方纳米) said that the company’s lithium raw material procurement channels cover both domestic and overseas sources. Domestically, it mainly comes from Jiangxi, Sichuan, and salt lake regions, while the company also lays out some overseas resources.

“Although the price of lithium iron phosphate is rising now, our overall orders in both domestic and overseas markets are sufficient.” The person from Dofalu Nano’s board secretary office added that automakers are only one of the application areas for the company’s lithium iron phosphate products, and the growth rate in demand in the energy storage field is currently already higher than that in the power battery field.

In the lithium hexafluorophosphate (LiPF6) segment, Multicamp (多氟多) focuses mainly on lithium hexafluorophosphate.

The person from the board secretary office said that the company’s lithium carbonate raw materials mainly rely on domestic procurement and do not involve related import business. Driven by the rise in lithium carbonate and lithium iron phosphate prices, downstream cell prices have also increased accordingly. Because lithium hexafluorophosphate had a larger increase earlier, the increase in this round is relatively moderate.

“The unit price base of lithium battery products is relatively large. Even if the terminal price goes up by just one or two cents, it will still lead to a relatively noticeable change at the level of the company’s overall profit.” An industry insider said.

Reporters from 《Science and Technology Innovation Board Daily》 learned that, affected by the rise in lithium carbonate prices, the current average market price of the entire electrolyte industry is 30k yuan/ton, up from 20k yuan/ton in the same period last year—an increase of 50%.

In response, a staff member from the securities department of Tianci Materials, a leading company in the electrolyte industry, said that after upstream raw material prices rise, the company’s product prices will follow the market. Currently, the company makes dynamic adjustments to product prices every month.

In the separator segment, Enjie Co., Ltd. (恩捷股份) is a lithium battery separator supplier in the industry. Regarding the rise in lithium carbonate prices, a person from Enjie’s board secretary office said that fluctuations in lithium raw material prices have no substantive impact on the company’s cost side, and only cause disturbances at the market sentiment level.

“Our main business is lithium battery separators. The raw materials are polyethylene and coating slurry materials. We do not use lithium carbonate. The overall operations are influenced by downstream battery supply and demand overall, and the correlation with lithium price fluctuations is relatively low.” The person from Enjie’s board secretary office further said.

▍ High growth in exports: China’s supply chain advantages are highlighted

Against the backdrop of tighter global lithium resource supply, China’s lithium battery industrial chain stability advantages continue to stand out, and related product export performance has also drawn close attention from the market.

“We’ve been doing exports all along.” A person from the board secretary office of Dofalu Nano said that benefiting from the rapid rise in overseas demand for lithium iron phosphate, combined with overseas battery companies accelerating their shift to lithium iron phosphate routes, the company’s export business has shown an upward growth trend. In addition, the person from Enjie’s board secretary office said the company’s overseas business layout is stable and it cooperates with multiple well-known overseas battery manufacturers, among others.

According to data from the General Administration of Customs, from 2025 to date, lithium iron phosphate export by leading enterprises has shown explosive growth overall. In 2025, total export volume was about 32.4k tons, compared with roughly 3,300 tons in the same period of 2024, representing a year-over-year surge of 880%.

For lithium battery material exports, a staff member from the securities department of Longpan Technology said that at this stage, China’s lithium iron phosphate technology is more competitive than the ternary routes in Japan and South Korea. Combined with geopolitical factors and constraints from overseas policies, it is difficult for overseas customers such as LG and Ford to switch to lithium iron phosphate routes, so relevant products need to be purchased from Chinese companies that have laid out overseas production capacity.

It is said that Longpan Technology currently has lithium iron phosphate capacity in Indonesia, effectively capturing overseas demand and boosting overseas business growth. At present, the first-phase base with 30,000 tons of capacity has been put into production in Indonesia, and the second-phase 90k tons capacity will be put into production this year. After the entire project is completed, total capacity will reach 120k tons.

Similarly, other companies also advancing overseas capacity layouts include W Ran Run New Energy and Tianci Materials, among others.

A person from the board secretary office of W Ran Run New Energy said that to accelerate the expansion of overseas markets, the company set up a subsidiary in South Carolina, USA, with a total planned construction of 50k tons of lithium iron phosphate production capacity per year. “Regarding project progress, this project is still in the construction stage currently and has not started production yet.”

On February 10, Tianci Materials issued an announcement stating that the company’s Morocco electrolyte project officially started. The project’s total investment is 8B Moroccan dirhams (about 280 million USD). After completion, it is expected to form comprehensive production capacity with an annual output of 150k tons of electrolyte and core raw materials.

When discussing future expectations for overseas markets, industry insiders generally believe that, on the one hand, overseas home energy storage, industrial and commercial energy storage, and data center energy storage demand are all relatively strong; on the other hand, the AI computing power and big data industry further drive related demand.

CITIC Securities’ research report estimates that in 2026, global demand for lithium batteries will reach 3,065 GWh, up 34% year over year.

(China Money Network reporter Wu Xuguang)