In July, EV battery prices in China demonstrated stability, with lithium salt prices registering a marginal decline. The prices of EV square ternary cells, LFP cells, and pouch ternary power cells in July remained relatively consistent with the prior month, positioned at CNY 0.73/Wh, 0.65/Wh, and 0.78/Wh, respectively. This trend comes amid relatively muted demand in the EV sector, according to TrendForce research.
Meanwhile, energy storage batteries witnessed steady market demand. The average price of these batteries dropped 1% MoM, falling to CNY 0.66/Wh, driven by falling prices of LFP cathode materials. Current overcapacity in China’s energy storage battery production is escalating competition, and the trend points to a continuous, albeit slow, drop in prices. Recently quoted prices for energy storage project bids have dipped below 0.6/Wh.
Consumer batteries faced weakening demand in the consumer electronics market in July, leading battery manufacturers to cut back their capacity utilization rates. Nevertheless, a slight uptick in the price of cobalt metal curtailed any significant drop in battery prices, which remained mostly consistent with the previous month. However, LCO battery prices are predicted to continue their downward trajectory in August, given the slow decrease in raw material (lithium salt and cobalt [II, III] oxide) prices, as well as lackluster downstream demand.
TrendForce points out that the Guangzhou Futures Exchange listed seven lithium carbonate futures contracts in July. Despite an initial major decline, futures prices managed a subsequent recovery, yet remained on a downward trend relative to the listing’s benchmark price. This also coincides with a gradual decrease in spot lithium carbonate prices, with July witnessing a 5% MoM fall in average lithium salt prices.
TrendForce believes that structural overcapacity is present to varying extents across most segments of China's lithium-ion battery industry chain, leading to a downward trend in supply chain prices. Among them, the price of lithium metal, which has the greatest impact on supply chain prices, is gradually stabilizing, reducing the likelihood of significant fluctuations. The listing of lithium carbonate futures has set the trend for spot prices of lithium carbonate over the next six months to a year. In the short term, the overall price changes in the lithium-ion battery supply chain are expected to stabilize. However, TrendForce does not rule out the possibility of a minor rebound in lithium salt prices during the peak demand period in the fourth quarter.
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