SMM

China's December LCO production was 6,326 mt, down 9% MoM but up 10% YoY. Declining Co3O4 and lithium carbonate prices reduced costs. In December's LCO off-season, downstream demand was weak, sparking fierce competition for orders, especially in the mid-to-low voltage segment, with frequent price cuts to win business. LCO manufacturers aimed to reduce stock, increase sales, and recover funds, leading to reduced production due to the dim demand outlook.
Downstream battery cell makers typically make long-term orders with occasional spot buys. January's pre-Spring Festival production push, considering cathode factories' 1-2 week February break, is expected to boost January scheduled production to prepare February stocks. The forecast for January is 7,092 mt, up 12% MoM and 125% YoY.