Lithium Carbonate Futures
As the demand for clean energy and zero carbon emission solutions escalates, lithium carbonate has become a cornerstone component in the production of rechargeable batteries.
With the rise of EVs worldwide, the importance of lithium carbonate has surged, making Lithium Carbonate Futures on one the most actively traded contracts globally.
Find out more about China’s Lithium Industry here and if Lithium Carbonate is the solution to clean energy.
This article aims to delve into the performance of lithium carbonate futures in 2023 and provides a forward-looking perspective on its trajectory in 2024, exploring the intricate dynamics of this market as it continues to play a vital role in shaping the future of sustainable energy.
Trading Lithium Carbonate Futures from GFEX and SGX
Traders can trade GFEX and SGX Lithium Carbonate Futures and Options through Orient Futures Singapore.
SGX offers FM Lithium Carbonate CIF CJK (Battery Grade) LIC/LICF futures contracts for traders to participate in the price discovery and hedging opportunities of this essential commodity in the lithium market.
Traders can trade from SGX through Orient Futures Singapore. Orient Futures Singapore currently holds membership with SGX, which makes it more accessible for traders to trade futures and options with the exchange.
Orient Futures Singapore also holds membership for Asia Pacific Exchange (APEX), ICE Futures Singapore (ICE SG), and is also an overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE).
This allows traders to access the international and China market (through QFI China Scheme or Internationalised Products), to trade commodity futures such as Soybean futures, Rapeseed Meal, Iron Ore Futures, and more.
Apart from Lithium Carbonate Futures, SGX also offer other Electric Vehicle (EV) Metals futures such as SGX FM Lithium Hydroxide Futures CIF CJK (Battery Grade) Futures and also GIFT Nifty (formerly known as SGX Nifty 50 Index Futures), SGX USD CNH Futures, and more.
Alternatively, more information about the benefits of trading with SGX can be found on the official SGX website.
Lithium Carbonate Futures 2023 Performance
Figure 1. Lithium Carbonate Price Chart for 2023 from Trading Economics
According to Trading Economics, Lithium carbonate prices fell below CNY 97,500 per ton towards the end of 2023. This is the lowest since August 2021, sinking over 80% for the year amid increasing oversupplies.
Pessimism about electric vehicle sales in China limited demand for lithium for battery manufacturers during their typical restocking season. Instead, firms took advantage of high inventories following the supply glut caused by extensive subsidies from the Chinese government throughout 2021 and 2022.
These developments led key market players to forecast the next lithium deficit to return only in 2028, marking an aggressive shift from speculations of persistent shortfalls that took lithium prices to CNY 600,000 in November 2022. Previous investments in increasing supply may drive the global carbonate equivalent supply to jump by 40% in 2024, deepening the ongoing surplus.
Lithium Carbonate Futures Market News
Lithium Carbonate Supply and Demand
According to Wall Street Journal, prices for metals crucial to batteries experienced a decline in 2023 due to increased supply and weak demand.
Lithium hit a two-year low, cobalt reached a four-year low, and nickel saw its lowest point since the pandemic's onset. This trend is expected to persist in the upcoming year.
While decreased metal prices temporarily benefit electric vehicles and grid storage affordability, prolonged low prices might hinder crucial investments needed for a sustainable energy transition.
Slow global economic growth, particularly in China, and rising interest rates impacted projections, with global electric vehicle sales for 2023 estimated at 14 million, with 63% in China.
Despite concerns about pre-Covid supply shortages, increased production in China and Australia, coupled with lower-than-anticipated demand, led to oversupply and significant price declines for lithium carbonate, cobalt, and nickel throughout the year.
Lithium Carbonate Price
According to SGX, Lithium Carbonate Futures is priced at USD $17,069.37 per ton, as of 29th December 2023.
Lithium Carbonate Futures 2024 Market Outlook
According to Trading Economics, key market players forecast the next lithium deficit to return only in 2028, marking an aggressive shift from speculations of persistent shortfalls that took lithium prices to CNY 600,000 in November 2022.
Reuters also reported that Global lithium supply is estimated to jump by 40% in 2024, to more than 1.4 million tons of lithium carbonate equivalent.
Output in top producers Australia and Latin America will rise 22% and 29% respectively, while that in Africa is expected to double, driven by projects in Zimbabwe.
Chinese production will also jump 40% in the next two years, driven by a major CATL project in southern Jiangxi province.
The supply surge will result in a global lithium surplus of 12%, up from 4% this year, according to CITIC Futures.
Trading Economics added that Lithium is expected to trade at 91983.80 CNY/T by the end of this quarter and estimated to trade at 83567.28 in 12 months’ time.
Start Trading With Orient Futures Singapore
Overseas Intermediary of Shanghai International Energy Exchange (INE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE), when foreign clients participate in internationalised futures contracts in these Chinese markets with us, they have direct access to trading, clearing, and settlement. Our parent company, Shanghai Orient Futures, is the largest broker in terms of aggregated volume across the five regulated exchanges in China.
Orient Futures Singapore also currently holds memberships at the Singapore Exchange (SGX), Asia Pacific Exchange (APEX), and ICE Futures Singapore (ICE SG). Starting August 2023, corporate clients can also gain access to the B3 Exchange through us.
We provide bespoke services to our professional clients, tailored to their corporate and individual needs. Our team will be there for you 24 hours on trading days to provide a one-stop portal for all your trades, with simple processes and an intuitive user interface that has low or near-to-zero latency.
