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Lithium Price Analysis: China Futures Rise Amid Weak Spot Demand

Mysteel’s latest report shows that the most actively traded lithium carbonate contract on the GFEX rose 1.97% to 178,860 yuan. However, the price of battery-grade lithium carbonate decreased slightly, falling 0.71% to 175,550 yuan.

The lithium market showed conflicting trends. Trading Economics reported a 1.14% increase in the price of lithium carbonate, reaching 177,500 yuan per tonne. However, Investing.com data showed a 1.96% decrease in China’s spot price for lithium carbonate, dropping it to 75,000 yuan.

Futures Recover as Spot Prices Lag

Lithium carbonate prices rose on Tuesday as traders responded to limited supplies and expectations of further price increases. The most actively traded contract on the GFEX exchange closed at 178,860 yuan, a 1.97% increase for the day, according to Mysteel.

According to Trading Economics, the price of lithium carbonate has risen by 2,000 yuan (1.14%) to 177,500 yuan per tonne. While prices have steadily recovered from last year’s lows, the recent increase is slower compared to the record highs of around 200,000 yuan.

Unlike futures prices, spot market prices for lithium carbonate declined. According to Mysteel, battery-grade lithium carbonate fell 0.71% to 175,550 yuan, and Investing.com’s China spot benchmark decreased 1.96% to 75,000 yuan for lithium carbonate with a minimum purity of 99.5%.

This suggests futures markets may have more support from suppliers than what’s currently happening in the actual, physical market. Demand isn’t strong enough yet to cause prices to significantly increase.

Supply Signals Support Sentiment

According to Mysteel, the market bounced back from earlier losses at reduced prices. Initially, investors were focused on making a profit, but then increased demand emerged as it became harder to source raw materials.

Lithium carbonate futures prices rose today after a key mine, Jianxiawo, announced delays in restarting production. This news boosted market confidence, leading traders to believe that lithium supplies might not increase as quickly as expected.

Zimbabwe’s government also weighed in on market discussions, stating that 14 key minerals – like lithium, nickel, cobalt, and graphite – are essential. They’ve announced a requirement for the government to have a minimum ownership stake in projects involving these minerals, managed through a dedicated investment vehicle.

This move is part of a larger effort by governments to oversee the supply of essential minerals. Adding another set of rules to how lithium is sourced comes alongside a growing trend of governments wanting more control over the raw materials used in batteries.

Buyers Stay Selective Before June

According to Mysteel, buyers weren’t rushing to increase their stockpiles. While trading activity was slow, prices did rise throughout the day. This indicates that buyers aren’t focused on simply rebuilding inventory levels, but rather on carefully choosing the materials they purchase.

Despite some challenges, there’s still demand for lithium carbonate. Several factories making LFP cathodes are expanding, which means we might see higher production levels in June. If battery material production increases as expected, this could boost the demand for lithium carbonate.

China is investing heavily in its power grid, which will create consistent demand for materials. The country’s central planning agency announced a five-year plan to spend over 5 trillion yuan on expanding and upgrading the grid infrastructure.

Increased battery demand is driven by the need for a more reliable power grid, which means expanding energy storage and using more renewable energy sources.

Currently, lithium is being used consistently every day. While future prices seem promising around 178,000 yuan, a stronger and more complete recovery depends on increased immediate demand from buyers.

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2026-05-29 23:26