SMM

December saw domestic lithium carbonate production at 44,000 mt, up 2.08% MoM and 26.36% YoY. The 2023 total reached 460,000 mt, up 31.38% YoY. Production rose slightly for some spodumene-based lithium salt firms due to more processing orders, while certain lepidolite-based companies in Jiangxi boosted output substantially to clear year-end lepidolite inventories. New lithium salt enterprises also contributed to the modest production increase, collectively driving up December's lithium carbonate production.
Due to low temperatures impacting efficiency, salt lake lithium salt enterprises have cut production seasonally. Enterprises using recycled materials also see reduced output because of a drop in battery cell production waste leading to raw material scarcity and shrinking profit margins or even losses.
Starting January 2024, several spodumene-based lithium salt producers will enter maintenance in late January, slightly reducing output. Many small lepidolite-based smelters, already cutting orders since December with raw material cost issues, will close in mid-January for maintenance until after the Spring Festival, foreseeing continued output decline. Most salt lake enterprises will maintain stable production, with production ramp-up from a new Xinjiang enterprise. In contrast, battery scrap-based lithium salt producers, in the face of raw material shortages and cost issues, are likely to cut production. January's domestic lithium carbonate production is estimated at 41,700 mt, down 5.12% MoM but up 16.18% YoY.