Lithium prices plunge in China after moves to curb speculative trading
Lithium prices in China fell sharply on Friday, short-circuiting a rally, after the main exchange stepped in to curb speculative trading and on a report that battery giant CATL could restart production at its flagship lithium mine.
The most-active lithium carbonate contract on the Guangzhou Futures Exchange closed daytime trading down 9% at 91,020 yuan ($12,804.21) per metric ton, hitting its lower limit and giving back most of this week’s gains.
The contract on Thursday hit its highest since June 2024 at 102,500 yuan a ton.
On Thursday, GFEX said it would increase transaction fees for some futures contracts of lithium carbonate from November 24, and it also planned to limit the daily open position for non-futures company members.
Such a move was widely seen as targeting speculative trading, analysts said, blaming some of the price correction on the decision.
Bloomberg News reported on Friday that CATL is planning to restart production at its lithium mine in Yichun, Jiangxi Province.
The Jianxiawo mine, where production has been suspended since August due to the expiration of its mining licence, can produce just over 46,000 tons of lithium carbonate equivalent a year, about 3% of global output for 2025, according to data from the Australian government.
CATL has told its lithium carbonate smelters to be prepared for a resumption of the Jianxiawo mine, two sources told Reuters without specifying a date.
The sources requested anonymity as they are not authorized to speak to the media.
CATL did not respond to a request for comment.
($1 = 7.1086 Chinese yuan renminbi)
(By Dylan Duan and Lewis Jackson; Editing by Kirsten Donovan)
CATL aims to restart key Chinese lithium mine by early December
A key Chinese lithium mine run by Contemporary Amperex Technology Co. Ltd. is preparing to reopen as soon as early next month.
The battery maker has formulated a preliminary plan to restart its Jianxiawo mine by early December, according to people familiar with the matter, who declined to be named as they aren’t authorized to speak publicly. The company has asked suppliers and partners to ready equipment, chemicals and workers, they said, as well as notifying the refiners that draw feedstock from the mine.
CATL’s preparations aren’t a guarantee that the mine will get regulatory approval. The people said the company’s schedule could be subject to change, and that they’re still awaiting sign-off from the authorities.
CATL didn’t immediately respond to requests for comments. Calls to the natural resources departments of both Yichun city and Jiangxi province, where the mine is situated, went unanswered.
The fate of Jianxiawo, owned by the world’s biggest maker of batteries for electric vehicles, has fixated the industry in recent months. Production at the mine was suspended in August after CATL failed to get an extension on an expired permit.
The mine is expected to account for about 3% of global lithium production. The supply uncertainty, at a time of tighter government scrutiny of the sector, has fueled heightened volatility in prices of the battery metal. Earlier this month, CATL was told how much it should pay for the mining rights, a crucial step in the process that would allow Jianxiawo to restart.
The lithium industry has struggled with a global glut, exacerbated by slowing demand for EVs, although prices have been boosted in recent weeks as the market becomes more confident in demand prospects from the energy storage sector.
The most-active lithium carbonate contract on the Guangzhou Futures Exchange has jumped over 10% this month, topping 100,000 yuan ($14,000) a ton earlier this week. Bullish sentiment intensified after Ganfeng Lithium Group Co.’s chairman predicted prices could reach as much as 200,000 yuan next year, if demand grows more than 30%.
(By Annie Lee and Alfred Cang)
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