China’s lithium carbonate imports remain high in June, adds to oversupply

China imported a total of 19,583 tonnes of lithium carbonate in June, according to the China’s customs data.

South American countries remain the main orgin of those carbonate imports in June, with 15,652 tonnes from Chile and 3,434 tonnes from Argentina.

Although the June imports went down by 20.28% from the May imports at 24,565 tonnes, June still marks the fourth consecutive month when the country’s carbonate monthly imports breached 19,000 tonnes.

China’s lithium carbonate imports totaled 106,389 tonnes in the first six months of 2024, up by 45.39% from 73,180 tonnes during the same period in 2023.

China’s lithium prices have been mostly on a downward trend in the recent months due to weak consumer demand and pessimistic near-term demand outlook in an oversupplied market, leading to thin spot liquidity of lithium carbonate.

Fastmarkets’ weekly price assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot price range exw domestic China was 84,000-87,000 ($11,548-11,960) yuan per tonne on July 18, down by 3,000-4,000 yuan per tonne from 88,000-90,000 yuan per tonne a week earlier.

“A monthly import of lithium carbonate at close to 20,000 tonnes is a lot, and it’s adding great downward pressure on China’s lithium carbonate [prices],” a Chinese lithium trader said.

A second Chinese lithium trader added, “The carbonate market is oversupplied. While China’s lithium carbonate production in the brines in Qinghai province is at its peak during summer, there’s also a lot of carbonate shipped to China from South America.”

Despite the weak demand in China’s domestic market and ongoing overysupply of carbonate, sources said that South American lithium producers still ship carbonate to China, given China is the biggest consumer in the world.

“The South American lithium producers ship carbonate to China first and then see whom those material will be sold to later, given that demand is weak internationally,” a third Chinese lithium trader said.

“The carbonate could be sold to China’s domestic market or Japan or South Korea later. Anyway, it’s convenient for the American material to be shipped to China first,” the third Chinese trader further added.

Compounded with the large carbonate imports was the high registered warrants of lithium carbonate on Guangzhou Futures Exchanged (GFEX).
Entering July, the registered warrants of lithium carbonate on GFEX exceeded 27,000 tonnes in each trading day and reached 34,702 tonnes on June 22, according to GFEX.

Although prices continued to decline, most producers maintained normal output levels, but several producers have been undertaking maintenance work since the start of the month, Fastmarkets learned.

Some market participants do not expect widespread maintenance work among Chinese lithium producers, saying that many of them, including some major companies, had finished maintenance in the first half year, and currently lithium prices have not fallen below the breakeven point of many lithium producers.

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