On August 10, the share price of Qinghai Salt Lake Industry Co., Ltd. rose. As of the close on August 10, the stock was up 2.43% at 29.5 yuan per share. In terms of news: On August 7, the company stated on an interactive platform in response to investor inquiries that the company's magnesium resource business layout focuses on upstream resource development, and its subsidiary Teli Magnesium mainly engages in magnesium alloy die-casting. Currently, this segment is still in a cultivation and development stage, with limited business volume and low contribution to the company's overall revenue. According to the survey record disclosed by the company on its participation in a survey from August 5 to 7: 1. Q: Can the company's current industrial water supply meet the release of existing capacity? The company responded: At this stage, the company meets daily production needs through existing industrial water supply, salt lake water recycling, and water recovery systems. It has established a complete intelligent water metering network system and set the water resource management target of "total volume within limits, unit consumption within standards." For total volume control, the company defines red lines based on water permits and requires strict implementation by production workshops. In terms of product water quota, the company strengthens water management and introduces new water-saving technologies and processes, with current water indicators surpassing industry standard requirements. 2. Q: How is the company's Fantasy Salt Lake scenic area, as a new profit growth point, currently operating? The company responded: Its subsidiary Dream Travel Company, as the exclusive operator of the Qarhan scenic area, deeply cultivates local tourism resource development and operations management. Leveraging Qarhan's unique salt lake landscapes and differentiated tourism experiences, the scenic area's appeal continues to strengthen. In recent years, centered on visitor experience, the scenic area has coordinated the dual improvement of infrastructure and service capabilities. Visitor flow and operational data have maintained growth for three consecutive years, exceeding 1 million visits in 2024, reaching 1.43 million visits in 2025, and hitting a single-day peak of 30,000 visits on August 3, 2026, for the first time, up 43% from the highest daily reception of 2025. 3. Q: In the company's H1 earnings forecast, lithium carbonate inventory increased. What are the company's future sales plans, sales model for lithium carbonate, and customer distribution? The company responded: The company currently has total annual lithium salt capacity of about 98,000 mt. Product sales combine market demand and medium and long-term price trends for dynamic inventory management. On the production side, the company implements production scheduling management based on annual production targets, comprehensively considering ore stockpiling, brine quality, seasonal climate, and production support assurance. Currently, production and operations are stable and orderly, with smooth connectivity between production and sales. Market conditions for core potassium and lithium products are improving, with strong industry demand support. On the sales side, the company implements a "long-term contract lock-in + bi-weekly pricing + point-price sales" mechanism, paired with hedging to offset short-term price fluctuations. Going forward, the company will take multiple measures to stabilize production, expand markets, ensure continuous resource supply, strictly control energy costs, promote technological upgrades, and broaden sales channels, striving to complete annual production and sales tasks and drive steady growth in operational performance. The company's lithium carbonate sales are centered on a direct-supply model, with stable and reliable customer resources mainly supplying domestic cathode material producers, accompanied by long-term cooperative trading partners. The stable and smooth direct-supply channel continuously ensures product distribution and solidifies the company's operational foundation. 4. Q: How is the company's current Congo Republic potassium salt mine project progressing, and when can capacity be released? The company responded: While consolidating core potassium and lithium businesses, the company continues to deepen the potash fertilizer field and place high importance on the development of overseas potassium salt resources, firmly implementing the "going global" strategy for potash. It also accelerates cooperation with foreign potassium resource-rich regions, actively expanding external resource acquisition channels. Currently, the company's Congo Republic BMB potassium salt mining right development is in the detailed exploration stage, and the company is fully accelerating related project processes. Given that the project is still in its early stages, subsequent progress remains uncertain. The company will strictly comply with relevant laws, regulations, and regulatory requirements to timely fulfill information disclosure obligations for project developments meeting disclosure standards. Investors are advised to rationally view the project's prospects, make prudent decisions, and be aware of investment risks. 5. Q: What are the company's market value management measures and buyback plans? The company responded: As a publicly listed platform controlled by a central state-owned enterprise, the company strictly implements the relevant arrangements of the State-owned Assets Supervision and Administration Commission's "Several Opinions on Improving and Strengthening Market Value Management of Listed Companies Controlled by Central Enterprises," always placing market value management at the level of long-term strategy and core operational responsibility for coordinated advancement. Since last year, the actual controller has increased its holdings by 248 million shares, the company completed the cancellation of 140 million treasury shares, smoothly implemented the injection of high-quality assets from the Yiliping salt lake, and commissioned the 40,000 mt/year lithium salt project, effectively expanding asset volume and further consolidating core competitive advantages. At this stage, the company has built a value foundation by deeply cultivating its main business, improving quality and efficiency, and strengthening core competitiveness through technological innovation; established a regular investor communication mechanism, continuously deepened comprehensive engagement with the capital market, fully demonstrated development strategies and operational performance, and enhanced market recognition of the company's intrinsic value; simultaneously introduced a special "Market Value Management System," incorporating market value performance into management performance evaluations, achieving institutionalized, normalized, and long-term operation of market value management. Regarding share buybacks, a matter of general concern to investors, the company has always attached importance to it. Share buybacks, as a major capital matter, require prudent study and demonstration in accordance with laws and regulations, considering the company's operational reality, financial condition, and market trends. If an implementable plan is formed, the company will strictly perform relevant internal decision-making procedures and timely and fully disclose it in accordance with regulatory provisions, safeguarding the company's intrinsic value and the long-term interests of all shareholders in a compliant manner. Going forward, the company will continue to deeply cultivate core potassium and lithium businesses, consistently improve quality and efficiency, and enhance operational quality and intrinsic value; strictly adhere to fair and compliant information disclosure requirements, with major matters announced on statutory platforms such as Juchao Information Network; and, when statutory dividend conditions are met, coordinate factors such as cash flow and capital expenditures to study profit distribution arrangements, effectively rewarding all investors with operational results. 6. Q: What measures does the company have to ensure the sustainable development of Qarhan salt lake resources and its own sustainable development? The company responded: Salt lake resources are important national strategic resources, bearing the major mission of ensuring food security and supporting new energy development. Centering on comprehensive utilization and efficient development of salt lake resources, the company actively promotes technologies for continuous potassium resource security, deep processing of lithium resources, diversified high-value development of magnesium resources, efficient extraction of rare elements in brine, cross-industry salt lake integration, and intelligent production. Relying on the Qarhan salt lake, China's largest soluble potassium and magnesium salt deposit, the company takes "comprehensive resource utilization" as its core concept, pioneering the development of all types of associated resources in salt lake brine, including potassium, lithium, magnesium, sodium, etc., building a globally leading cascade utilization system for salt lake resources, achieving comprehensive utilization. First, strengthen salt lake resource exploration, ascertain resource reserves, revitalize existing resource stocks, and effectively strengthen salt lake mine geology and resource reserve management. Utilize advanced applicable green extraction technologies for salt lake resources, iterate dissolution mining technologies such as solid-to-liquid conversion, fully utilize low-grade solid potassium salt resources, focus on increasing reserve resources, and extend the service life of salt lake mines as much as possible. Adopt new technologies, apply new methods, build innovation platforms, enhance the value-added of salt lake products, and create a highland for salt lake industry development with strong innovation capacity, good clustering effects, and superior functional characteristics. Second, improve the management system for salt lake resource development and utilization, promote unified planning, unified development, and unified management of resources, address shortcomings in salt lake mine geology and resource management, scientifically regulate the intensity of salt lake resource development, and comprehensively improve the efficiency of resource development and utilization. 7. Q: The company has achieved significant results in cost reduction and efficiency improvement in recent years, with the full cost of lithium carbonate continuously declining. How does the company view its current cost moat? What specific plans are there to further consolidate cost advantages and enhance risk resistance capabilities in the future? The company responded: The company firmly establishes the concept of "accounting-based operations, lean management, and value creation," strengthens resource supply monitoring and production factor assurance, and builds an integrated operating system for monthly operational scheduling, comprehensive budget management, and performance evaluation benchmarking. Production tasks are successfully completed, and operational performance continues to improve. Leveraging the unique resource endowment of the salt lake, combined with the "adsorption + membrane" lithium extraction process, the company optimizes processes to achieve the best salt lake lithium extraction, building a significant low-energy-cost advantage. The lithium carbonate production costs at Yiliping salt lake and Qarhan salt lake are in the industry-leading tier, with strong risk and cycle resistance capabilities. Going forward, the company will continue to focus on the following: First, always take cost reduction and efficiency improvement as the core leverage of management, fully establish and achieve three-level coverage of the amoeba management system, and implement refined cost control across the entire chain of production, supply, sales, transportation, and operations. Second, persist in empowering industrial upgrades through technological innovation, driving deep integration of the innovation chain with the industry chain. Third, adhere to the synergistic efforts of top-level design and grassroots practices, advancing the modernization of corporate governance systems and governance capabilities in depth. Fourth, closely follow national strategic guidance, improve the overall development plan for the salt lake industry, and continuously strengthen capabilities to support food security and new energy. On July 29, the company stated on an interactive platform in response to investor inquiries that its current total annual lithium salt capacity is about 98,000 mt. Product sales combine market demand and medium and long-term price trends for dynamic inventory management. At this stage, inventory is normal turnover stockpiling after capacity release. The company maintains long-term cooperation with downstream clients, with sales flexibly allocated based on market conditions. Going forward, it will coordinate and optimize inventory turnover based on market conditions. On the performance front: On the evening of July 2, the company released its 2026 H1 earnings forecast, showing that it expects net profit attributable to shareholders of the publicly listed firm for H1 2026 to be between 6 billion yuan and 6.3 billion yuan, up 131.38% to 142.95% YoY. A research report from Huaxin Securities commenting on the company's 2025 annual report showed: The company released its 2025 annual performance report: In 2025, the company achieved total revenue of 15.501 billion yuan, up 2.43% YoY; and net profit attributable to shareholders of 8.476 billion yuan, up 81.76% YoY. Among this, in Q4 2025 alone, the company achieved revenue of 4.391 billion yuan, down 6.29% YoY but up 1.40% QoQ; and net profit of 3.973 billion yuan, up 161.05% YoY and up 99.87% QoQ. Investment highlights: Price recovery combined with cost optimization fully unleashed profitability elasticity. Expense optimization and ample cash flow. Solid resource reserves lay the foundation, with diversified layout opening growth space: The company's resource reserves are solid, and the new 40,000 mt lithium salt project was completed and put into trial production at the end of September 2025, integrating the self-developed "adsorption + membrane" lithium extraction process. Currently, the company's potash capacity reaches 5 million mt/year and lithium carbonate capacity reaches 40,000 mt/year, with scale advantages continuously consolidated. Looking ahead, the company will deeply integrate into the strategic layout of China Minmetals, fully implement the "three-step" strategy for China's salt lake industry, and focus on efficient and comprehensive development of salt lake resources. It is expected that by 2030, it will form capacities of 10 million mt/year potassium fertilizer, 200,000 mt/year lithium salt, and over 30,000 mt/year magnesium and magnesium-based materials. As a core enterprise in building China's world-class salt lake industry base, the company will fully benefit from resource integration and industrial upgrading, with broad growth space. Risk warnings: Risks such as fluctuations in potassium and lithium prices, project commissioning falling short of expectations, demand falling short of expectations, and changes in industry policies.

In July 2026, the lithium carbonate market experienced a persistent downward trend, with the overall price center of gravity shifting lower. The tug‑of‑war between strong spot fundamentals and weak forward expectations persisted throughout the month. Price : Early in the month, prices rebounded from lows on supply‑contraction expectations, with the main contract LC2609 surging from around RMB 145,300/ton to RMB 167,800/ton—a weekly gain of approximately 8.4%. Thereafter, the market weakened under the combined pressure of anticipated Zimbabwean ore arrivals, progress on domestic lepidolite mine restarts, and expectations of warehouse receipt cancellations. The main contract opened July at RMB 164,000/ton and closed on July 31 at RMB 137,760/ton, falling nearly RMB 30,000/ton over the month with an intra‑month amplitude of 21.55%. In the spot market, the price center for battery‑grade lithium carbonate moved notably lower compared with June. By mid‑July, the futures curve shifted into backwardation, with the spread between near‑term and forward contracts widening further. Supply : Domestic lithium carbonate output edged down month‑on‑month in July, with actual production of approximately 105,000 tons. The decline was mainly attributable to concentrated maintenance at spodumene‑ and lepidolite‑based smelters—temporarily suspended Zimbabwean concentrate exports delayed raw material arrivals, reducing spodumene‑based lithium carbonate output. Salt‑lake operations entered their peak production season, with a modest output increase that partially offset the reduction. Upstream lithium salt producers maintained a strong reluctance to sell spot cargoes, with persistently low willingness to offer, keeping their in‑house inventories at low levels. Demand : Downstream activity remained robust. In July, domestic lithium battery production rose 5.6% month‑on‑month, while LFP cathode material production increased 6.85% month‑on‑month. Downstream material producers continued their strategy of buying on dips as needed, showing strong willingness to purchase for rigid demand below RMB 145,000/ton, but with limited acceptance of higher prices. No large‑scale concentrated restocking emerged. Inventory : Lithium carbonate inventories accelerated their drawdown in July, with social inventories declining for twelve consecutive weeks. Large‑sample inventory data showed a roughly 8% decline over the month, with the weekly drawdown rate accelerating from 2.68% to 4.46%. Structurally, inventories shifted from upstream to downstream, as strong end‑consumption effectively absorbed spot stocks. Outlook : In the near term, lithium carbonate prices are likely to remain in a range‑bound, weakly volatile pattern. Ongoing maintenance and tightening raw material flows provide support, while forward supply‑increase expectations—including progress on the Jianxiawo mine restart and scheduled Zimbabwean ore arrivals—continue to cap upside. High downstream production schedules offer rigid demand support, but the impetus to chase prices remains insufficient. Key factors to monitor include the pace of smelter maintenance resumption, August downstream production expectations, and the actual release rhythm of ore‑side supply.

[SMM Daily Review: 3 August – Spot Lithium Carbonate Continues to Fall] Today, SMM’s spot price for battery-grade lithium carbonate continued to fall compared with the previous working day. The lithium carbonate 2609 contract opened lower today at 137,500 yuan per tonne; following the opening, it fluctuated lower and quickly dipped, touching a low of 135,600 yuan per tonne; Subsequently, long positions drove a volatile rebound, with the price fluctuating around the moving average line during the morning session; as the morning session drew to a close, long positions intensified, propelling the price to rapidly break through the 140,000 yuan mark and surge to 140,800 yuan per tonne. In the afternoon, the price retreated amid selling pressure from short positions and profit-taking, and consolidated within a narrow range of 138,800–139,000 yuan per tonne towards the close, eventually closing down 1.15% at 138,900 yuan per tonne, with open interest decreasing by 3,474 contracts. In the spot market, as it was the first working day of the month, downstream material manufacturers began dispatching goods under long-term contracts and for customer orders; spot buyers remained cautious, purchasing only on an as-needed basis when prices were relatively low. Upstream lithium salt producers continued to maintain their willingness to support prices for spot sales, with the focus at the start of the month on ensuring supply through long-term contracts and contract volume increases. Overall, the level of activity in market enquiries and actual transactions declined somewhat.

[SMM Daily Review: 5 August – Spot lithium carbonate prices rose amid volatility] Today, SMM’s spot price for battery-grade lithium carbonate rose amid volatility compared with the previous trading day. The lithium carbonate 2609 contract opened lower today at 139,700 yuan per metric tonne; after briefly dipping to 138,300 yuan per metric tonne following the opening, it found support, with long positions driving a volatile rebound; during the morning session, the price fluctuated firmly within the 140,000–142,000 yuan range; although there were some fluctuations, the price centre gradually shifted upwards; around midday, bulls and bears engaged in a tug-of-war within the 141,500–142,500 yuan range; In the afternoon, bulls continued to exert pressure, driving the price to rise in a choppy manner. As the session drew to a close, a concentrated influx of capital caused the price to surge rapidly to 144,300 yuan per tonne, setting an intraday high. This was followed by a slight pullback due to some profit-taking, with the price closing near 143,200 yuan per tonne. The contract ultimately closed up 2.61% at 143,200 yuan per tonne, whilst open interest fell by 9,640 lots. In the spot market, downstream buyers purchased on a needs-based basis at lower levels; some downstream firms saw an increase in spot order demand as long-term contract volumes were reduced due to maintenance at upstream lithium salt plants. Upstream lithium salt plants remained relatively cautious regarding spot sales; those with maintenance plans prioritised long-term contract supply this month, whilst some showed a slight easing in their willingness to maintain prices. Overall, market enquiries and actual transactions remained relatively stable.

Battery-grade lithium carbonate stood at RMB 139,000/mt as of August 4, down 16.27% month-on-month, continuing a weak downward trend even as fundamentals strengthen a "strong reality, weak price" divergence now driving the market. On the demand side, NEV and energy storage sectors remain robust, with domestic battery production schedules up 6-8% MoM in August and power battery demand steadily recovering, keeping utilization rates and rigid demand support above market expectations. On the supply side, overseas disruptions policy controls and geopolitical tension in lithium-rich countries, extreme weather in Argentina, and concentrated maintenance among domestic lithium salt producers continue to limit near-term supply growth. Inventories have now declined for 12 consecutive weeks, with total social inventories falling to 114,300 mt as of the week ending July 30 and the pace of destocking accelerating. Downstream and distributor stocks are being steadily worked off, while only upstream smelters show slight accumulation, easing inventory pressure across the industry. Despite this tightening spot picture, market funds have overdrawn pessimistic long-term expectations, with pricing logic now driven by forward supply demand outlook rather than current conditions. As H1 results from lithium battery producers confirm earlier optimism on energy storage demand, capital has rotated toward bearish positioning, focused on doubts over the sustainability of high-growth energy storage installation demand and expectations of an accelerated release of new production capacity pushing the market toward consensus on a looser future supply demand balance. SMM view: Lithium carbonate is likely to maintain a "near-term strong, far-month weak" divergence rather than a unilateral trend. Continued destocking and resilient downstream demand should firm up spot prices as pessimistic sentiment gradually unwinds, while far-month contracts stay pressured by expectations of loose future supply and elevated industrial chain valuations. Close attention to supply-demand shifts is still warranted.

On the evening of August 3, Shida Shenghua New Materials Group Co., Ltd. disclosed that its wholly-owned subsidiary plans to invest in the construction of three major projects: a 230,000 tons/year liquid lithium salt project, a 200,000 tons/year electrolyte project, and a 12,000 tons/year additive project. The total investment for the three projects amounts to approximately 2.805 billion yuan. According to the announcement, the 230,000 tons/year liquid lithium salt project will be implemented by Dongying Shida Shenghua New Energy Co., Ltd., with an approved investment of approximately 1.797 billion yuan and a construction period of 24 months. Upon reaching full capacity, the project is expected to produce 150,000 tons/year of DMC liquid lithium salt and 80,000 tons/year of EMC liquid lithium salt annually, along with by-products including hydrochloric acid, dimethyl carbonate, and ethyl methyl carbonate. The project is projected to generate annual operating revenue of approximately 6.086 billion yuan and net profit of about 1.523 billion yuan.

[SMM Analysis: Raw Material Price Hikes Push Up Production Costs, Electrolyte Prices Start an Upward Trend] Recently, upstream raw materials for electrolyte—including additives, lithium chemicals, and solvents—have all seen price increases, continuously squeezing the profit margins of electrolyte enterprises. As cost pressure is gradually transmitted downstream, the electrolyte has entered a price hike cycle.

According to combined data from the General Administration of Customs and SMM, China's total imports of lithium raw materials (spodumene + lithium sulfate) approached 80,000 tonnes in lithium carbonate equivalent (LCE) in June 2026, remaining at elevated levels and providing a solid feedstock base for the continued rise in domestic lithium salt production. Spodumene: Import Volumes Continue to Climb, Australian Year‑End Shipment Surge Contributes Significantly In June, China's spodumene imports reached 768,000 physical tonnes, up 13% month‑on‑month and 33% year‑on‑year, equivalent to approximately 72,000 tonnes LCE. The import scale has maintained a high growth trajectory for several consecutive months, reflecting robust end‑user demand from domestic lithium salt producers for upstream ore feed. A clear divergence in supply sources emerged: Australia remained the dominant supplier, with the year‑end fiscal push by mines fully materialising in June. Arrivals exceeded 370,000 tonnes, up 12% month‑on‑month, broadly in line with market expectations for quarter‑end shipment concentration. As the anchor of China's spodumene supply, Australia's stable shipments set the tone for the month's total imports. Mali saw arrivals rise significantly month‑on‑month to 60,000 tonnes, providing a phased incremental supply for related smelters' production needs. South Africa and Nigeria both maintained steady performance, with arrivals from each exceeding 110,000 tonnes. Notably, the share of high‑grade concentrate in Nigerian ore continued to rise, exceeding 65%, extending the trend of grade structure optimisation. Zimbabwe, affected by earlier export restrictions and cross‑border transport inefficiencies, saw arrivals fall back to 42,000 tonnes in June, a month‑on‑month decline, indicating persistent short‑term supply volatility. In terms of grade composition, SMM data show that the share of lithium concentrate in total arrivals fell to 72% month‑on‑month. The main drag came from Brazil – its 65,000 tonnes of arrivals were mostly previously booked lithium raw ore fines, the concentration of which pulled down the overall concentrate ratio. Lithium Sulfate: Imports Accelerate Month‑on‑Month, Zimbabwe Makes Its First Supply Breakthrough In addition to spodumene, lithium sulfate imports also deserve attention. In June, China's lithium sulfate imports reached 13,500 tonnes, up 12% month‑on‑month, equivalent to over 7,700 tonnes LCE. By source, Chile continued to dominate the supply landscape with 13,400 tonnes. Meanwhile, imports from Zimbabwe quietly exceeded the 100‑tonne level for the first time – although still small in absolute terms, this marks the country's first bulk shipment of lithium sulfate to China, heralding the potential for future normalised supply from Zimbabwe. Overall Assessment: June Feedstock Support Solid, but Tightening Spot Availability in July Raises Concerns In aggregate, combined spodumene and lithium sulfate imports in June reached nearly 80,000 tonnes LCE. Together with domestic lithium concentrate production of over 30,000 tonnes, total domestic lithium raw material supply exceeded 110,000 tonnes LCE for the month, providing ample and relatively stable feedstock support for the high operating rates of lithium salt production in June. However, beneath the seemingly upbeat headline figures, a key variable warrants attention: the majority of June's arriving cargoes had been pre‑locked via contracts weeks or even months in advance, leaving only a small share available for free‑trading spot circulation. The persistence of this pre‑locked structure implies that spot market availability of lithium ore will remain tight in July. If downstream rigid‑demand procurement paces hold steady, the tightening of available spot supply will constrain lithium salt producers' flexibility in raw material sourcing to some extent, thereby limiting the further upside room for lithium carbonate output in July – a transmission effect that has already been reflected in recent SMM weekly lithium carbonate production data. Source: General Administration of Customs of China, SMM

This week, ternary cathode material prices continued their downward trend. On the raw material front, nickel sulfate and cobalt sulfate edged lower amid subdued trading activity, while manganese sulfate prices rose slightly. Lithium carbonate and lithium hydroxide saw notable declines recently, influenced by capital market volatility. In terms of transaction sentiment, some manufacturers restocked at lower price levels last week when lithium salt prices fell sharply, leading to relatively active trading. However, entering this week, raw material prices continued to decline with no clear signs of stabilization. With sufficient inventories on hand, downstream battery cell manufacturers generally turned cautious and slowed their procurement pace, resulting in subdued transaction sentiment this week. On the payable front, influenced by the continued decline in absolute nickel sulfate prices, some ternary cathode manufacturers saw upward adjustments in nickel sulfate payables during settlements. Payables for other metals remained relatively stable. On the demand side, EV market demand remained at high levels recently, with orders being executed as normal, while consumer market demand continued to stay subdued.

Yongxing Materials expects its net profit for the first half of 2026 to increase 137%-187% YoY to 9.5-11.5 billion yuan. The company attributed the growth to strong demand from the EV and energy storage sectors, higher lithium salt prices, and stable production and sales of its lithium carbonate products.