The Knowledge Base: The Impact of Harsh Environments on Residue Tolerance
Standard of Excellence: Hiring for Quality Positions in Manufacturing, Engineering, and Management
Global Citizenship: What I’ve Learned About the American PCB Business
June Lithium Prices Hit New Low for the Year; Cell Prices Still Facing Downward Pressure
July 8, 2024 | TrendForceEstimated reading time: 2 minutes
TrendForce reports that June saw a significant drop in lithium prices due to a focus on inventory reduction in the downstream battery sector. Weak demand for lithium salts and sluggish shipments of lithium carbonate—compounded by short-term oversupply—drove lithium carbonate prices to a new low for the year. Prices fell from over CNY 100,000 per ton last month to the range of CNY 90,000 per ton.
Battery costs have fallen in line with declining raw material prices, leading to a sustained decrease in EV battery cell prices. TrendForce’s survey indicates that in June, EV battery cell prices fell by 1-2% compared to May. Monthly ASP for square ternary, square LFP, and pouch ternary EV battery cells were CNY 0.49/Wh, 0.42/Wh, 0.51/Wh, respectively.
In the ESS sector, the mid-year peak in grid-connected installations in China has ended, leading to a decline in ESS cell orders. Additionally, the drop in lithium carbonate prices has not provided stable support for ESS cell prices, resulting in a price decrease. In June, the average price for LFP ESS cells was CNY 0.41/Wh—down 4.2% from May.
TrendForce analysis indicates that competition in ESS cell pricing remains intense, with cell and system makers adopting low-price strategies to secure orders. This has pushed current prices of ESS cells and systems below the cost range for most cells makers and poses a significant challenge to cost control. Major cell makers are now competing in the 300 Ah+ large-capacity cell product segment and by 2Q24, most mainstream suppliers are expected to begin mass production of 300 Ah+ cells, potentially leading to further cost reductions.
TrendForce notes that the lithium battery market experienced a peak season from March to May. However, post-June, demand for raw materials for battery cells has weakened due to sufficient pre-stocking by downstream sectors. Lithium prices are under pressure given current market conditions with relatively loose supply. In July, market demand is expected to remain weak, with lithium prices falling to the sensitive range of CNY 80,000–90,000 per ton. Despite some supply-side contraction, overall supply will still exceed demand as the weak price trend persists.
Consequently, the cost support for EV and ESS cells will continue to weaken and cell prices expected to face downward pressure at the beginning of the third quarter. Stability or a rebound in prices will depend on restocking demand during the peak season at the end of the third quarter.
Share on:
Suggested Items
Weak Demand Outlook and Rising Inventory and Supply Pressure DRAM Prices Down for 2025
11/18/2024 | TrendForceThe fourth quarter is a critical period for setting DRAM contract prices. TrendForce’s latest research reveals that prices for mature DRAM processes such as DDR4 and LPDDR4X are already trending downward due to ample supply and declining demand.
Increased Production and Weakened Demand to Drive NAND Flash Prices Down 3–8% in 4Q24
10/15/2024 | TrendForceTrendForce’s latest findings reveal that NAND Flash products have been impacted by weaker-than-expected seasonal demand in the second half of 2024, leading to a decline in wafer contract prices in Q3. This downward trend is projected to deepen, with prices expected to drop by more than 10% in Q4.
Buyers Focus on Inventory Reduction; Slowing Demand Growth Constrains Q4 Memory Price Increases
10/10/2024 | TrendForceTrendForce’s latest findings reveal that weaker consumer demand has persisted through 3Q24, leaving AI servers as the primary driver of memory demand. This dynamic, combined with HBM production displacing conventional DRAM capacity, has led suppliers to maintain a firm stance on contract price hikes.
Battery Cell Prices Continue to Decline in August, but Demand Could Improve in September
09/12/2024 | TrendForceTrendForce reports that the market for battery metals such as nickel, cobalt, and lithium remained weak in August, with prices for these raw materials continuing to fall.
Spot Market for Memory Struggles in First Half of 2024; Price Challenges Loom in Second Half
08/30/2024 | TrendForceTrendForce reports that memory module makers have been aggressively increasing their DRAM inventories since 3Q23, with inventory levels rising to 11–17 weeks by 2Q24.