What Is Lithium Carbonate?
Lithium Carbonate is a white and odourless chemical compound. It is commonly used in various industrial applications.
This compound is essential for its high lithium content. This makes it a crucial component in advancing clean energy technologies and renewable energy storage solutions. Lithium Carbonate formula is Li2CO3.
What Is Lithium Carbonate Used For?
The most common Lithium Carbonate uses is to make lithium-ion batteries, which are essential components in various daily products. These batteries power numerous devices, including smartphones, laptops, tablets, cameras, power tools, electric vehicles, and even medical devices.
The demand for lithium-ion batteries has grown significantly in recent years. This is due to the increasing adoption of electronic gadgets and the shift towards electric vehicles. This makes Lithium Carbonate important in making batteries technologies and a popular futures contract to trade for.
GFEX Launches Lithium Carbonate Futures and Options
The Guangzhou Futures Exchange (GFEX) announced that they have launched Lithium Carbonate Futures on 21st July 2023. This would offer traders another opportunity to hedge price volatility in the battery raw material.
According to Reuters, GFEX sets the base price for its lithium carbonate futures contract at 264,000 yuan per metric ton.
GFEX has also started offering lithium carbonate options trading from 24th July 2023.
Traders can get access to GFEX Lithium Carbonate Futures through Orient Futures Singapore. Contact us now to find out more.
SGX Lithium Carbonate Futures
Apart from GFEX, traders can also trade Lithium Carbonate Futures through the Singapore Exchange (SGX).
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.
What Are The Benefits of Trading With SGX
Some of the benefits of trading with SGX include reduced counterparty risk through daily mark-to-market positions, holistic trading opportunities for products of virtual car complex, up to 21.5 hours of clearing, and safe trading with a trusted and recognized clearing house.
Furthermore, SGX operates at with a standard trading procedure, orders, and timing, which will enable traders to trade efficiently.
Apart from Lithium Carbonate Futures, SGX also offers 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.
SGX FM Lithium Carbonate CIF CJK (Battery Grade) Futures Contract Specifications
The SGX Lithium Carbonate Futures contract follows the following specifications:
The contract size for Lithium Carbonate is 1,000kg multiplied by the Contract price, with a minimum price fluctuation of one-hundredth of a United States dollar, equivalent to ten United States dollars per Contract.
SGX Trading Hours are from Monday to Friday, at these trading hours:
7:10am - 8:00pm (T-session)
8.00.01pm - 5.15am (T+1 Session)
7:10 am – 8:00 pm (Last Trading Day)
Lithium Carbonate Price
According to Trading Economics, the price of lithium carbonate dropped to less than CNY 265,000 per tonne in early August 2023. This marks the lowest point in over two months.
This sharp decline came after the price had remained steady at the CNY 300,000 mark from the end of May to the end of July. The decrease was driven by Chinese battery producers who ceased their restocking processes and halted purchasing activity.
During this period, Beijing has been actively working to increase lithium production, which has contributed to easing buying competition from battery manufacturers and reducing the risk of shortages.
The decrease in demand from battery manufacturers can also be attributed to the end of China's subsidies and tax breaks for new energy industries, resulting in a selloff after lithium carbonate prices peaked at a record high of CNY 600,000 in November 2022.
Despite the recent decline, spot prices for lithium carbonate remain 60% higher than the 18-month low of CNY 166,500 recorded on April 25th, as the demand for new energy vehicles (NEVs) has shown signs of recovery from the earlier setbacks at the beginning of the year. In June, Chinese NEV sales surged by 25%, accounting for 35% of total auto sales.
Lithium Carbonate Market Outlook
According to S&P Global, global lithium demand is projected to surpass lithium production by approximately 3% in 2023. This would be driven by the increasing adoption of electric vehicles in various countries.
Despite efforts by major producers to ramp up their output, the growing demand for lithium, mainly due to the expansion of electric vehicle markets, is expected to create a supply-demand gap. This trend highlights the critical importance of securing a stable and sufficient lithium supply to support the continued growth of the electric vehicle industry.
Start Trading With Orient Futures Singapore
Being an 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 premium customer service at an affordable cost to all our clients. 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.
