MB-CU-0403 Copper grade A cathode premium, cif Shanghai, $/tonne
MB-CU-0380 Copper grade A cathode ER premium, cif Shanghai, $/tonne
MB-CU-0384 Copper grade A cathode SX-EW premium, cif Shanghai, $/tonne
MB-CU-0405 Copper grade A cathode premium, in-whs Shanghai, $/tonne
MB-CU-0383 Copper grade A cathode ER premium, bonded in-whs Shanghai, $/tonne
MB-CU-0382 Copper grade A cathode SX-EW premium, bonded in-whs Shanghai, $/tonne

These premiums are a part of the Fastmarkets Base Metals package.

For more information or to provide feedback on the delayed publication of these premiums or if you would like to provide price information by becoming a data submitter to these premiums, please contact Callum Perry by email at: pricing@fastmarkets.com. Please add the subject heading “FAO: Callum Perry, re: Copper Shanghai Premiums.”

Please indicate if comments are confidential. Fastmarkets will consider all comments received and will make comments not marked as confidential available upon request.

To see all Fastmarkets pricing methodology and specification documents, go to https://www.fastmarkets.com/methodology.

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For others though, the bearish sentiment, slowing EV demand growth and low lithium prices represents an opportunity for Europe to rationalize its approach to batteries and EVs.

By revisiting subsidy and incentive programmes that support scaling of the entire value chain, and by leveraging technology/skills transfer and industrial partnerships with leading nations, Europe can refine its strategies to create a robust battery supply chain, according to Fastmarkets’ head of battery raw materials analytics, Paul Lusty.

Want to know more about the global BRM market outlook for 2025? Get a detailed understanding of the issues: watch the webinar recording and access the slides when you fill in the form here. 

Building the supply chain in Europe

With rising demand for electric vehicles (EVs) and renewable energy storage, Europe has made efforts to build its own supply chain for battery production, but the continent has long been dependent on global suppliers – particularly those in Asia – for key battery components.

To counter this reliance and establish a robust, self-sufficient battery supply chain, the EU has rolled out a series of strategic legislative and investment initiatives aimed at stimulating domestic growth and innovation.

Central to this effort was the European Green Deal, which underscores the critical role of batteries in achieving climate neutrality by 2050. And the EU has introduced the Battery Regulation – a legal framework focusing on sustainability, recycling, and ethical sourcing of raw materials.

Recognizing the need for upstream investments, the EU has classified batteries as a Strategic Value Chain under its Important Projects of Common European Interest (IPCEI) program.

This designation allows member states to channel public funds into research, development, and industrial projects without breaching EU state aid rules.

Additionally, the EU has created the European Battery Alliance (EBA), a public-private partnership designed to stimulate collaboration between governments, industry leaders and research institutions.

The EU is also imposing new emissions regulations that increase the price of internal combustion engine (ICE) vehicles in 2025 to further incentivise EV demand.

Through these measures, Europe has laid the groundwork for a supply chain that spans raw materials extraction, refining, cell manufacturing and recycling.

However, the path to independence has been fraught with challenges, including securing the raw materials, scaling up production capacity and competing with established businesses from around the world.

And the slowdown in EV demand growth, coupled with a prolonged period of low lithium salts prices, has led to a series of bearish announcements from companies within the supply chain – from carmakers cutting staff and closing factories to battery producers filing for bankruptcy.

Reactions to the slowdown in EV demand

While the market has been gloomy about EV demand growth, Fastmarkets researchers expect year-on-year growth in 2024 to be around 29%. But while growth has been relatively strong, it has still been lower than expected, which contributed to the revision of operations by a number of automakers and battery supply chain companies in Europe.

Northvolt, for instance, which makes battery cells for EV batteries, filed for Chapter 11 bankruptcy protection last week related to the expansion of its.Northvolt Ett gigafactory at Skellefteå in northeast Sweden. The company said operations there would continue during the process, including “fulfilling obligations to critical vendors and payment of wages to employees.”

The company said it aims to complete a restructuring process during the first quarter of 2025.

And Portuguese energy company Galp said it will not proceed with the construction of its Aurora lithium project in Portugal, following the news of Northvolt filing for Chapter 11. Northvolt decided to stop investing in Aurora in early 2024, Galp said.

Aurora, an equal joint venture between the two companies, was set up to develop Europe’s largest lithium conversion plant, with an annual production capacity of up to 35,000 tonnes of battery grade lithium hydroxide. It was hailed by Northvolt as a stepping-stone for developing an integrated lithium-battery value chain when the partnership was announced in 2021.

Car manufacturing giant Volkswagen has said it is aiming to close at least three factories in Germany, cut tens of thousands of jobs and downsize all remaining plants, according to the company’s works council. The company reported deliveries of EVs were down by 4.7% year on year in January-September, which it attributed to “industry-wide buyer reluctance” to buy EVs.

“The biggest hurdle that we face in terms of EV demand growth in Europe – taking Germany as an example, after the government there axed EV subsidies – is affordability,” one market participant told Fastmarkets.

Germany’s government ended subsidies for EVs in December 2023 after revising its budget.

And leading US auto manufacturer, the Ford Motor Co, said in late November that it will reduce its European workforce by 4,000 positions by the end of 2027 – primarily in Germany and the UK.

“The global auto industry continues to be in a period of disruption, especially in Europe, where the industry faces unprecedented competitive, regulatory, and economic headwinds,” Ford said.

Falling battery raw material (BRM) prices

Lithium prices have been in steep decline throughout most of 2024, which has cut producer and refiner profit margins significantly and slowed the uptake of new projects in Europe.

Prices for battery-grade lithium hydroxide recently fell to their lowest level – on a midpoint basis – since Fastmarkets began assessing the market in 2017.

Fastmarkets’ price assessment for lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price cif China, Japan & Korea was $8-9 per kg on November 12, but has since rallied to $8.50-10.00 per kg on Monday December 3.

The lithium hydroxide price has fallen by more than 40% since the beginning of 2024 when it stood at $14.50-16.50 per kg.

Cobalt prices have also dipped, but not as rapidly as lithium, falling by around 18% since the start of the year.

And Fastmarkets’ price assessment for cobalt standard grade, in-whs Rotterdam, was $10.10-12.00 per lb on Tuesday December 3, down from $12.80-14.18 per lb at the beginning of the year.

Europe’s faltering supply chain

Reactions to automaker cutbacks and Northvolt filing for bankruptcy, as well as slowing EV demand growth amid falling BRM prices mainly point towards the view that Europe can still achieve its goal of an independent supply chain, but not without changes to its approach.

“I think it’s quite clear that we’re in a down-cycle across the batteries sector in the West,” one consumer told Fastmarkets. “The period of rapid initial growth dictated decision making around start-up strategies, investments, etc, and I think this is a correction of that.

“While there will be struggles ahead, I see this as a time to rationalize Europe’s approach to batteries and EVs. We see political pushback from the public and OEMs alike, although I don’t believe this will stop the train. A European battery sector can and will work with more refined strategies. If politicians want less dependence on China, then they will need to better facilitate this to get past the early adoption point on the curve,” the consumer added.

One producer said Northvolt filing for Chapter 11 protection was “more bad news that puts additional pressure on lithium hydroxide prices, because there is another player or customer in that market for battery-grade products that might completely disappear.

“But on the supply chain side, it’s a disaster for Europe that there is apparently not enough downstream demand from battery production to allow [cathode active material] (CAM) producers in Europe to be successful. [The question is,] how long will it take for that demand to pick up?” 

“From what we’ve seen on the demand side for batteries in Europe, it’s a consequence that those companies cannot survive here. We will probably need either demand to pick up or regulation that states we need European production for European cars. As long as that’s not the case [it will] always be more competitive to source those materials – up to and including batteries – from Asia,” the producer added.

Some sources criticized the EU for its lack of incentivisation.

“[Northvolt] shows cobalt has less of a future than we all thought for batteries – it’s proof of poor demand,” a trader said.

“The EU has too much bureaucracy and regulation and, as always, was busy encouraging the supply chain with one hand while cutting its legs off with the other,” the trader added.

And a consumer told Fastmarkets: “A lot of lessons have been learned and reality checks have been handed out. But infrastructure for day-to-day EV use is improving and costs are falling, so adoption will grow and the need for a domestic industry will be there.

“Pragmatic growth, with political willpower, will provide a future for European industry,” the consumer added.

Challenging growth landscape

Fastmarkets researchers forecast that European lithium carbonate equivalent (LCE) production will grow at a compound annual growth rate (CAGR) of 51% between 2024 and 2034, but the landscape for growth is challenging.

“We remain concerned that, in the current price environment, companies developing projects in Europe will struggle to access financing and advance project development,” Lusty said.

“Project development costs in Europe are relatively high, so it will struggle to compete on a cost basis with established centers of lithium production and opposition to mining projects is an ongoing challenge for the region,” he added.

Opportunities for Europe – collaboration

“Europe needs a local or regional supply chain because relying on one that is controlled by China is too big a risk, given the potential for escalation in geopolitical tensions,” according to Fastmarkets’ head of base metals and battery research, Will Adams.

“But it’s proving very hard to build, for numerous reasons – technical know-how, high capital expenditure and operating expenditure costs, low BRM prices and insufficient government support.

“One way or another, Europe’s lithium-ion battery chain will need significant government support or partnerships with those who already have the know-how and those who can bring in the finance,” Adams added.

Muthu Krishna, Fastmarkets battery manufacturing cost modeller said a collaborative approach would provide a viable route to a European supply chain.

“Yes, there is risk of relying on imports from China, but [focusing on] collaboration over competition, which allows for knowledge transfer to European partners while giving access to the European markets for the big Asian players, would be a win-win scenario,” Krishna said.

“As material supplies slip into deficit, which we forecast will occur during 2025, prices will rise. But these rises must now stabilize at a level that allows downstream OEM profitability (such as, not making battery packs too expensive) while at the same time enabling upstream players to make a profit and expand supply to meet demand,” Krishna added.

And Lusty said: “Europe has been focused on improving its supply chain resilience and the security of supplies of raw materials for years, but this appears to have done little to shelter it from the structural vulnerabilities of global supply chains and the complexity of energy transition markets or to improve its cost competitiveness.

“Policy levers will only it take it so far. A rapid pivoting of strategy is required, involving coordinated and sustained subsidy and incentive programmes that synchronously support the scaling of the entire value chain, plus technology/skills transfer and industrial partnerships with leading nations,” he added.

Want to know more about the global BRM market outlook for 2025? Get a detailed understanding of the issues: watch the webinar recording and access the slides when you fill in the form here. 

The post Europe’s battery supply chain at a crossroads in terms of challenges, opportunities appeared first on Fastmarkets.

“There is a need for India to invest in resource-rich, friendly nations and minimize its reliance on imports, especially from countries with a potential trade risk in the future,” the report India’s Hunt for Critical Minerals said on October 28.

India’s reliance on imports is likely to persist, and domestic mines within India will take more than a decade to start producing, the report added.

Global lithium demand rose by 30% in 2023, and demand for nickel, cobalt and graphite increased by 8-10%, due to growing solar and wind power capacities, EV sales and stationary battery storage capacities, according to the report. Demand for key minerals is expected to double globally by 2030, the report added.

Being cost-competitive

Several downstream market participants believe that raw material security is not a significant priority for India, Fastmarkets’ editorial and research teams heard during a visit to the country in September.

A focus on maintaining cost competitiveness with other countries, such as China, remains a bigger concern.

“Ultimately, the biggest factor for all our decisions is cost — are we cost-competitive with China?” one battery producer told Fastmarkets during the visit. “If we can’t be cost-competitive, our customers will continue to import the cheaper alternative cells.”

By contrast, in Western countries, battery producers and original equipment manufacturers (OEMs) typically view a lack of government support and a lack of infrastructure as the biggest hurdles for EV and battery adoption.

“EV alternatives must be cost-competitive to their ICE [internal combustion engine] counterparts in India, or further adoption could be a challenge,” one OEM source told Fastmarkets.

“It is not so much the sourcing part; it is the cost part that concerns us. For us, being cost-competitive is quite important,” another market participant said.

The government’s push

Still, the government has made some progress in boosting domestic production by auctioning and selling mineral exploration blocks.

But this may take some time to yield results, some market participants told Fastmarkets.

India relies on imports primarily due to an absence of domestic production and refining capacities for some of these minerals, according to the IEEFA report.

The country has been auctioning critical mineral blocks since late 2023 to transition to clean energy and away from its current reliance on coal power.

The Indian Ministry of Mines announced on Thursday November 7 that it successfully concluded the auction of eight critical mineral blocks, taking the total number of auctioned critical and strategic mineral blocks by the government to 22 blocks. These eight blocks contain deposits of minerals such as cobalt, phosphorite, graphite and vanadium, essential for high-tech and green energy applications.

In June, the government announced that the auction for 14 out of 18 blocks, launched in February, was cancelled. Out of the 14 blocks annulled, five were cancelled as no bids were received, and nine received less than the mandatory requirement of three bids.

“Since India is a developing economy, there still exists a gap of knowledge and expertise in terms of boosting domestic infrastructure, and it may take some time to set up domestic capacities; however, significant steps have been taken by the government in the last seven years to get this going,” a trader source told Fastmarkets.

The Indian government has also pursued the acquisition of critical mineral assets in resource-rich and friendly countries. A government official said in July at an industry event that India was in discussions with African and Latin American countries to increase its reserves for strategic and critical minerals.

A source close to the Indian government told Fastmarkets, “If [the discussions] go through, [it] will have an impact on reducing the supply volatility [that India currently faces]. Moreover, it will help downstream industries and complement the ongoing efforts of the Indian government to support the manufacturing of energy-storage components and systems in India.” 

A joint exploration and mining deal is yet to be confirmed, but a similar deal between Khanij Bidesh India Ltd (KABIL) and CAMYEN, an Argentine state-owned company, was signed earlier this year for the exploration and mining of five lithium blocks in Argentina.

KABIL was set up in India in 2019 to identify, explore, acquire and develop critical mineral assets overseas, as well as invest in the sourcing of critical minerals for the domestic market, according to its website.

But some participants said that the government should do more to support the market.

“We have heard from the customer side that the government should step in and be more aggressive in its support for the market to significantly develop,” a source told Fastmarkets.

The post India’s cost concerns in critical minerals outweigh issues in relying on imports: sources appeared first on Fastmarkets.

The plant has a nameplate capacity of 180,000-200,000 tonnes per year of spodumene concentrate but has a lower capacity and operates at higher cost than the company’s Pilgan plant, which also produces spodumene concentrate.

The company will therefore focus solely on production from the Pilgan plant, a move which the company estimates will improve cashflow by A$200 million ($131.2 million).

“While the Ngungaju plant has undergone significant upgrades since it was acquired from Altura Mining, it does not match the scale or processing capability of the Pilgan plant,” Pilbara Minerals said.

The placing of the Ngungaju plant on care and maintenance will reduce the company’s forecast production of spodumene concentrate in fiscal year 2025 though, by around 100,000 tonnes.

The company reports an estimated production guidance of 700,000-740,000 tonnes in 2025, compared to the previous guidance of 800,000-840,000 tonnes.

Supply glut has pressured lithium prices lower

Following a slowing in global demand for lithium relative to the rate of production increases, the lithium market has experienced significant oversupply, which has weighed on spot prices.

Since reaching their peaks in 2022, prices for lithium products, including battery grade lithium salts and spodumene, have largely returned to multi-year lows.

Fastmarkets most recently assessed the spodumene min 6% Li2O, spot price, cif China at $730-770 per tonne on Wednesday, unchanged from the previous day, but down by 21% since the beginning of 2024.

Fastmarkets research currently forecasts that the global lithium market is set to record a surplus of 137,500 tonnes in 2024 on an lithium carbonate equivalent (LCE) basis, following a 175,700-tonne LCE surplus in 2023.

In fact, the lithium market is currently set to experience surpluses until 2027.

This surplus is causing concern among some market participants about the direction of future lithium prices.

“I don’t think we see any significant change in price fundamentals without cuts on the supply side,” a trader told Fastmarkets.

This is a view echoed by Pilbara in their quarterly reports statement.

“Consistent with market commentary, further market rebalancing, through either increased demand or supply curtailments, is required to catalyze a near-term price improvement,” the company said.

There is historical precedent for the need for production cuts to support price recovery. During the price downturn in lithium between 2018 and 2020, there were a series of production cuts, particularly on the spodumene side of the market.

In that period, there were curtailments at Bald Hill and Wodgina mines, as well as production reductions at Pilgangoora and Mt Cattlin mines. The closure of Altura in October 2020, which included the Ngungaju project, was the final cutback before prices began to recover in 2021.

“With the market oversupplied production cuts are needed, so Pilbara’s decision to idle the Ngungaju plant is an important development,” William Adams, Fastmarkets head of base metal and battery raw materials research, said.

“The last time the Ngungaju plant closed, when Altura Mining went into administration in October 2020, it signaled the bottom of the bear market – unfortunately it is unlikely to have the same impact this time round, as more cutbacks are going to be needed to rebalance the market,” Adams said.

Want to know more? Read Fastmarkets’ spodumene FAQs here.

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Eramet and Tsingshan had previously partnered on the Centenario project, beginning construction of a lithium carbonate extraction plant in October 2021 after a successful pilot plant run since 2019. The facility, inaugurated in July 2024, has a nameplate capacity of 24,000 tonnes per year of battery-grade lithium carbonate.

The plant will begin production in the coming weeks, the company said.

The purchase of Tsingshan’s stake in the Centenario lithium project in Argentina is interesting in numerous ways, Fastmarkets’ head of base metals and battery research William Adams said.

“The decision to regain full ownership of this project shows a Western miner is still confident in the project despite the current weak prices, and why wouldn’t it be? The oversupply and price weakness are temporary, the world is going down the green transition route and as more things are electrified or more renewable power generation is added, demand for energy storage is only going one way,” Adams said.

“The bigger the whole industry becomes, the harder it will be for producers to keep up with demand. Western companies need to compete with Chinese companies to ensure sovereignty. This deal increases Western sovereignty as well as gives Eramet full control over how the operation expands,” he added.

Direct lithium extraction technology

The Centenario lithium project is equipped with advanced direct lithium extraction (DLE) technology for efficient and sustainable production, which gives the operation commercial advantages, as well as the chance to roll out future operations in regions where mining or evaporation ponds would not be viable, according to Adams.

DLE involves the selective extraction of lithium from lithium-rich solutions and sources, such as brines, and bypasses the need for evaporation ponds, allowing for faster extraction rates, lower water consumption and a reduced environmental impact.

“DLE extraction at Centenario allows lithium production from brines in five days with a 90% yield, so it is more efficient and faster than getting lithium units from hard rock — which is more energy intensive — or via evaporation, which can take 12-18 months and generally yields 40-60%. This will mean supply responses can be quicker and greener,” he said.

“If Eramet’s DLE technology is proven to work, then it should put it in prime position to apply the technology in other jurisdictions where there are brines that can only be extracted by DLE methods,” he added, noting that Europe is an example of such jurisdictions due to its population density and heavy rainfall, which make large evaporation ponds commercially unviable.

“DLE is more environmentally acceptable too, as they tend to have a relatively small footprint compared with an open pit spodumene mine,” Adams said.

Several companies are using or aim to use DLE technology in their lithium extraction processes, including China’s Tianqi, US companies Standard Lithium and Compass Minerals, and Canada’s E3 Metals.

Australian mining firm Rio Tinto has also bought into DLE operations recently. The company signed a definitive agreement to acquire US-listed Arcadium Lithium, a company with DLE expertise at its Salar del Hombre Muerto project in Argentina.

Centenario lithium brine reserves

Eramet’s Centenario lithium project sits within Argentina’s Centenario and Arizaro salars, which contain one of the world’s most significant lithium brine reserves, with a total estimated resource of over 15 million tons of lithium carbonate equivalent (LCE). Eramet estimated this will support a long-term production capacity exceeding 75,000 tpy of LCE.

The acquisition, which comes amid historically low lithium prices, doubles Eramet’s share of production and enhances its flexibility to expand its lithium asset portfolio. Eramet plans to reassess the scope and timing of future capacity expansion, which is planned to double every five years for the next two decades due to the growing EV market, the company said.

“Eramet placed its first plant at Centenario project in the lowest quarter of the cash cost curve, with a post ramp-up cash cost of $4.50-5.00 per tonne of LCE. But they first need to prove that level is achievable by producing battery-grade material, in commercial volumes, at a steady rate,” Adams said.

Battery grade lithium carbonate prices have been highly volatile in the last few years.

Fastmarkets’ daily assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices, cif China, Japan & Korea was $10.00-11.25 per kg on October 28, the lowest level since April 2021 and down from all-time highs of $80-82 per kg in November-December 2022.

Eramet acquired the minority stake in Eramine Sudamerica for a net cash impact of $699 million. The company said it now holds 100% of the offtake rights, and already has a deal to jointly market around 50,000 tonnes of lithium with trading house Glencore.

Separately, Eramet also announced it was suspending plans to build a battery recycling project in Europe, “pending a solid and sustainable economic model [in the continent].”

Fastmarkets has more than 150 years of specialist commodity expertise. As well as our thousands of metals prices, we have two benchmark lithium prices, both launched in 2017: lithium carbonate and lithium hydroxide. Fastmarkets also offers two market-leading spodumene prices. Find out more here.

The post Eramet regains full ownership of Centenario lithium project in Argentina appeared first on Fastmarkets.

The CME Group announced the spodumene futures contract, which is settled against Fastmarkets’ spodumene, min 6% Li2O, spot price, cif China assessment, on September 30.

”We are pleased FIS continue to be the pioneer and first broker in the battery metal derivative space – as these markets develop contracts like spodumene will enhance the growth in risk management tools,” John Banaszkiewicz, founder of Freight Investor Services (FIS), said.

“It’s great news to see active participants from day one, and this seems to be only the start. We believe this new contract will provide new opportunities to market participants to handle their price risk exposure over the whole lithium complex (lithium hydroxide, lithium carbonate, spodumene),” Robin Tisserand, head of battery metal at SCB, said.

This new spodumene futures contract adds to an existing group of cash-settled futures contracts launched by CME Group for lithium, including lithium hydroxide and lithium carbonate, which are also settled against Fastmarkets’ spot prices.

Fastmarkets spodumene price assessment

Fastmarkets’ daily assessment of spodumene, min 6% Li2O, spot price, cif China was at $730-760 on Friday October 25, unchanged from a day earlier, but was down by 21.58% from $900-1,000 per tonne on January 3.

Anticipation for the launch of the new futures contract had been growing within the market, with participants generally expressing interest in the new risk management tool.

“It’s definitely an interesting development,” one consumer told Fastmarkets. “It allows us to explore new potential avenues in our approach to lithium.”

“Anything which supports the broader development and maturity of the spodumene market is a positive in our eyes,” a trader said, adding that the emergence of a transparent forward curve for spodumene will be a significant step in the price development of the market.

There have been some reservations regarding the latest launch, with participants noting the complexity of spodumene concentrate as a product, due to variations in grades and impurities.

One broker told Fastmarkets that due to the relative newness of the contract, it would take time for some participants to begin trading it.

“A lot of the reaction we’ve seen towards the contract has been from the physical side of the market, I think the financial side is still evaluating how to approach it,” the broker said.

Fastmarkets amended the minimum accepted lithium content in the specifications for the spot spodumene assessment in September, reducing the minimum lithium oxide grade content to 5.0% from 5.7%, if it can be normalized to be priced on a 6% basis.

The market feedback showed that even though spodumene is still typically priced at the 6% benchmark, the actual grades for spodumene have broadened significantly in recent years, with spodumene regularly produced and traded below 5.7% grade.

Despite some initial caution though, the significant role of spodumene in the production of lithium chemicals means that attention on the market has grown significantly in recent years.

Spodumene price volatility

Spodumene prices have shown great volatility in history, with the prices rising to an all-time high of $8,000-8,575 per tonne between November 24 to December 8, 2022, according to Fastmarkets’ historical data, following a global electric vehicle market boom.

Spodumene prices remained under general downward pressure following weakness in the downstream lithium salts market over the past year, especially because spodumene prices are increasingly linked to lithium salts prices.

This relationship between the two products has been heavily scrutinized in recent times, largely due to a fundamental shift in the percentage value of spodumene against battery grade lithium hydroxide.

Historically, spodumene had typically represented around 4% of the price of lithium hydroxide.

But during the 2021 price cycle in lithium, prices for battery grade lithium hydroxide increased more than 300% in a year, before eventually peaking in December 2022, with a more than 800% increase over the course of two years. During the peak, and since that time, the percentage value has stood at 7-10% typically.

As a result, a greater commitment to price transparency has grown in the market, with producers now offering auction events as a method of providing additional price transparency.

Fastmarkets uses these auction prices in its price assessments across the lithium suite, normalizing to our specifications where necessary.

Want to know more? Read Fastmarkets’ spodumene FAQs here.

The post CME spodumene futures contract sees trading activity on launch day appeared first on Fastmarkets.

“This feels like a significant moment for lithium and shows how far the market has come in recent years,” one market participant told Fastmarkets.

“A deal like this, with a counterparty of Rio Tinto’s stature, shows that the lithium market is reaching a key level of maturity in its evolution,” a consumer said.

With the deal, Rio Tinto, a significant producer in many commodity markets such as iron ore and aluminium, will join the list of major lithium producers globally, alongside the likes of Albemarle, SQM and Ganfeng Lithium.

Arcadium Lithium, a company formed from a merger of Allkem and Livent, was created in January 2024 and has capacity of 75,000 tonnes per year of lithium carbonate equivalent (LCE) across all of its products.

Meanwhile, Rio Tinto, until now, has been a relatively small player in the lithium space with a number of assets in the pipeline.

These assets are the Rincon project in Argentina, which will use direct lithium extraction (DLE) technology to produce 3,000 tpy of lithium, set to begin production later this year.

Rio’s other asset is the Jadar lithium-boron project in Serbia, which has the potential to be Europe’s largest lithium mine, with slated capacity of 58,000 tpy of battery-grade lithium carbonate.

But the project has run into a number of hurdles due to backlash from local communities in Serbia.

The merger of the two companies creates an environment where Rio Tinto can leverage Arcadium’s lithium expertise, particularly in the field of DLE where Arcadium has been a long-standing participant through its Salar del Hombre Muerto project in Argentina.

For Arcadium, the move provides access to significant capital to assist in the development of its ambitious expansion plans which would more than double its annual capacity by the end of 2028.

“Arcadium Lithium is an outstanding business today and we will bring our scale, development capabilities and financial strength to realize the full potential of its Tier 1 portfolio,” Rio Tinto chief executive officer Jakob Stausholm said in the statement.

“This is potentially a major development for the lithium market as it will catapult Rio Tinto from a position of relatively little lithium exposure to being a leading global producer,” Fastmarkets head of battery raw material research Paul Lusty said.

A ‘counter-cyclical’ acquisition

The deal comes at a time when lithium prices sit at multi-year lows, having fallen more than 80% since their highs in late 2022.

Fastmarkets assessed the lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price cif China, Japan & Korea at $9-10 per kg on Tuesday October 8, down from $9-10.55 per kg the previous day. Lithium hydroxide prices are down close to 89% since December 2022 when they were at $84-86 per kg.

Fastmarkets assessed the lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea stable at $10.70-11.30 per kg on the same day, down 86% in the same timeframe.

“This is a counter-cyclical expansion aligned with our disciplined capital allocation framework, increasing our exposure to a high-growth, attractive market at the right point in the cycle,” Stausholm said in the statement.

“This is a classic attempt to buy the dip for Rio, snapping up some high-quality lithium assets when spot prices are around 80% down on their highs,” Matt Britzman, senior equity analyst for Hargreaves Lansdown, told Fastmarkets.

The acquisition value of $6.7 billion is significantly higher than the initial approach bid reported late last week, which stood at $3.3 billion. But the deal is still “a touch under 20% of where Arcadium was trading when the company was formed in January,” according to Blitzman.

Reaction to the news mixed among market participants

Although the deal is considered a significant development within the market, overall reaction to the news was somewhat mixed among physical market participants.

Fastmarkets understands that there was broad expectations that Rio Tinto would make a move into the lithium market, with rumors of the potential acquisition of Arcadium circulating before the initial announcement of an approach.

Some view the acquisition as supportive of the narrative of lithium’s strong long-term fundamentals.

“I think this is a positive sign for lithium,” a second trader told Fastmarkets. “It demonstrates the belief in the longer-term story of lithium, despite the current low prices.”

“This is a significant move from Rio Tinto, showing their confidence in lithium’s long-term story,” the consumer source said.

This view was echoed by Rio in its announcement, with the company outlining its confidence “in the long-term outlook for lithium, with more than 10% compound annual growth rate (CAGR) in lithium demand expected through to 2040 leading to a supply deficit.”

It added that the “acquisition comes at a time with substantial long-term market and portfolio upside, underpinned by an appealing market structure and established jurisdictions.”

Fastmarkets analysts forecast that the market will continue to record surpluses in lithium supply until 2027, when demand will once again outstrip supply.

Fastmarkets currently forecasts a deficit of 17,096 tonnes in 2027, increasing to more than 68,000 tonnes in 2028. Fastmarkets analysts forecast a CAGR in lithium demand on an LCE basis at 12% out to 2034.

But although it is viewed by some as a positive signal for lithium’s longer-term story, there is not much expectation of any immediate impact on the market from the acquisition agreement.

“The acquisition doesn’t cause much discussion in China. It is mostly beneficial to Rio Tinto’s own resource layout as the company will have both hard rock and brine resources after the acquisition,” one Chinese analyst source commented.

The post Rio Tinto to acquire Arcadium Lithium in a ‘significant’ moment for lithium market appeared first on Fastmarkets.

In China, participants are out of the market due to the Golden Week celebrations from October 1-7, while South Korea held a public holiday on October 3. As a result, the GFEX has been closed since September 30 and will not resume trading until October 8.

This overall lack of activity within the market also resulted in other regions experiencing limited trading, with prices in Europe and the US remaining stable overall.

CIF CJK

The uptick in GFEX lithium carbonate prices led to an increase in lithium carbonate prices in the CJK market, according to sources, with sellers adjusting their offer levels in line with the Chinese bourse.

The 2411 (November) contract on the GFEX closed at 79,750 yuan per tonne on Monday September 30, up by nearly 4% from the previous day, and from 76,950 yuan per tonne on September 27.

Participants told Fastmarkets that the increase in prices was largely driven by improved sentiment following the announcement of economic stimulus measures in China, which are supportive for lithium demand.

The uptick in the GFEX, paired with this renewed sense of optimism in the market caused many participants to adjust their view of lithium carbonate prices, with many in China now unwilling to transact below $10.70 per kg on a CIF basis.

Fastmarkets’ daily price assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea was $10.70-11.30 per kg on Thursday October 3, unchanged from a day earlier but narrowing upward by $0.70 per kg from $10.00-11.30 per kg a week earlier.

Despite the uptick in lithium carbonate prices, there was no reaction was in the hydroxide market. Participants remained bearish due to the persistent oversupply of this product and soft overall demand.

“I think it would take something very significant to see any upward trend in hydroxide prices; the fundamentals are different to carbonate,” one trader told Fastmarkets on the sidelines of LME Week.

Fastmarkets’ daily price assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price cif China, Japan & Korea was $9.00-10.55 per kg on Thursday, unchanged on the previous day and the previous week.

Spodumene

The increase in GFEX and lithium carbonate prices also had a knock-on effect in the spodumene market during the week to Thursday, with prices rising amid higher offers and bullish sentiment.

Fastmarkets’ assessed the spodumene, 6% Li2O min, spot price, cif China at $800-820 per tonne on Thursday, unchanged from the previous day but up from $770-802.86 per tonne one week prior.

Sources said both bids and offers have been steadily rising since late last week with spodumene producers and traders looking to capitalize on the renewed optimism, but a gap remains between the two that is keeping sales volumes low.

“It’s tough to know how supported the most recent increase in spodumene is; it will depend what happens when China returns,” a second trader told Fastmarkets.

Spodumene market participants were mostly focused on the announcement that the Chicago Mercantile Exchange (CME) would be launching a new cash-settled futures contract for spodumene in late October, subject to regulatory approval.

The spodumene cif China futures contract is linked to Fastmarkets’ spodumene min 6% Li2O, cif China price assessment and arrives amid growing liquidity and complexity in the lithium market. Learn more with our FAQs.

European lithium prices

Spot lithium carbonate and hydroxide prices were flat during the week to Thursday for both technical grade and battery grade.

Muted activity as a result of many market participants attending LME Week kept prices steady.

Some sources said the increase in European lithium carbonate prices during the previous week was due to a slight reduction in China’s carbonate inventories, which buoyed market sentiment this week.

But overall market demand remains slow and the gap between bids and offers remains wide, a European distributor said.

Fastmarkets’ weekly assessment of lithium carbonate 99% Li2CO3 min, technical and industrial grades, spot price ddp Europe was unchanged at $11.00-12.20 per kg on Thursday.

Fastmarkets’ weekly assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot price ddp Europe was also unchanged at $12.00-13.00 per kg on Thursday.

Fastmarkets’ weekly assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, technical and industrial grades, spot price ddp Europe was flat week on week at $10.00-11.00 per kg on Thursday.

Fastmarkets’ weekly assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price ddp Europe was also flat at $10.00-11.80 per kg on Thursday, also unchanged from a week earlier.

US lithium prices

Spot lithium prices in the US were stable across the board during the week to Thursday.

Market activity was limited, keeping the premium unchanged, according to one market participant.

Fastmarkets’ weekly assessment of lithium carbonate 99% Li2CO3 min, technical and industrial grades, spot price ddp US and Canada was at $12.00-13.20 per kg on Thursday, unchanged from the previous week.

Fastmarkets’ weekly assessment of lithium carbonate 99.5% Li2CO3 min, battery grade, spot price ddp US and Canada was $13.00-14.00 per kg on Thursday, also unchanged week on week.

Fastmarkets’ weekly assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, technical and industrial grades, spot price ddp US and Canada held at $10.50-12 per kg on Thursday.

Fastmarkets’ weekly assessment of lithium hydroxide monohydrate LiOH.H2O 56.5% LiOH min, battery grade, spot price ddp US and Canada was also flat from the previous week at $11.00-12.80 per kg on Thursday.

Keep on top of lithium price volatility with our lithium prices, news, forecasts and more. Head to our hub.

The post Lithium carbonate, spodumene prices edge higher on Chinese stimulus measures appeared first on Fastmarkets.

In the panel “Critical Minerals & the Future of the Battery”, Geoff Streeton, chief development officer at French non-ferrous miner Eramet, highlighted this trend.

“The Chinese engineering and project delivery ecosystem is able to deliver [large capital-intensive projects] with a step change in cost and speed relative to the traditional project delivery models,” Streeton said.

Eramet, a significant producer of nickel, already has several partnerships with Chinese firms across their global operations.

These include a partnership with Chinese firm Tsingshan, the world’s largest stainless steel producer, for nickel mining and refining in Weda Bay, Indonesia. The two companies also have a joint venture agreement for the operation of the Centenario direct lithium extraction plant in Argentina.

Ivan Vella, managing director and chief executive officer of Australian miner IGO, discussed their partnership with Tianqi Lithium in Australia.

He emphasized the importance of these collaborations, saying: “I think it’s fundamental. The strength of the broader battery and EV (electric vehicle) industry in China, with companies like Ganfeng and Tianqi, is formidable. Being partnered with Tianqi gives us a lot of insight and strength.”

Indonesia perhaps provides one of the best examples of this speed and cost competitive scaling of projects. Chinese firms within the country have been able to develop, build and operate nickel refining assets at considerably lower cost than many other nickel producers, a trend which has ultimately shifted the global supply-demand balance of the market.

Streeton also highlighted the complementary skills that Western companies bring to these partnerships.

“You have to bring also to the table the skills that they lack… which is around how you manage workforce, how you manage ESG (environmental, social, and governance) issues, and how you ensure that community development can be done properly,” Streeton said.

Europe’s EV supply chain should work more closely with its Chinese counterparts to technologically catch up, according to experts at Fastmarkets’ European Battery Raw Material conference in Amsterdam on September 16-18. Several speakers emphasized the importance of forming partnerships with Chinese technology companies for immediate transfer of technology to help Europe develop knowledge and drive down costs in its battery supply chain.

Low prices threaten future critical mineral supply

Though partnerships with Chinese firms can provide benefits to Western producers of critical raw materials, the current price environment for battery metals like lithium and nickel are providing a barrier to investments in new projects and exploration.

Hanna Schweitz, director of battery materials and asset development at WMC Energy, said, “It’s of course a very high risk that at these prices you see less investments, less companies can spend money on actually investing in finding the best deposits.”

In the lithium market, it is typically said that the incentive price for investment in expansions or new projects sits around $20-25 per kg on a lithium carbonate equivalent (LCE) basis, depending on the resource and region.

At present, lithium prices sit well below this level.

Fastmarkets’ daily assessment of the lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea was $10.70-11.30 per kg on Tuesday October 1. 

Nickel is a more complicated market to evaluate in terms of incentive prices, because it depends on the type of nickel being produced and the technology being used. But typically, non-Indonesian producers of nickel have sat on the higher side of the cost curve.

The benchmark price for nickel remains the London Metal Exchange nickel cash price. The LME nickel cash official price closed at $17,002 per tonne on September 30, up from $16,652 per tonne on September 27.

The LME nickel cash price is down by close to 12% since June 1.

IRA and the battery metal regulatory landscape

Panelists at the FT’s Mining Summit also discussed how the Inflation Reduction Act (IRA) in the US might influence battery metal sourcing.

“No OEM (original equipment manufacturer) wants to take the risk of having some non-compliant material in their supply chain with the risk of losing the money if they are not adherent to the rules,” said Schweitz.

Streeton commented on the IRA’s potential impact, saying, “You’ve got to factor in that these are policy interventions. They’re not structural interventions that are permanent potentially.”

Vella expressed scepticism about the IRA’s impact on raw material suppliers, stating, “I don’t know of anyone who can reference the point where that EV subsidy actually flows all the way back to the raw material supplier… and even if it did, how material would it be?”

Our expert editorial team, analysts and price reporters working across metals, battery raw materials and rare earths bring you the latest price trends, market insights and forecasts for the critical minerals market. Track critical minerals markets with our price data and market coverage today.

The post Critical minerals sector eyes Chinese partnerships to cut costs, boost technology: LME Week appeared first on Fastmarkets.

The spodumene market has rapidly evolved in recent years, increasing in diversity of supply and consumption. As a result, grades for spodumene have broadened significantly since the launch of Fastmarkets’ spodumene spot price in 2017, with spodumene regularly produced and traded below 5.7% grade.

Fastmarkets therefore reduced the minimum lithium oxide grade content to 5.0%, if it can be normalized to be priced on a 6% basis, to better reflect the current market dynamics.

Despite the decline in grades, spodumene is still typically priced at the 6% benchmark.

Similarly, the trading of small-tonnage parcels of spodumene has become less common, with standard transactions closer to 10,000 tonnes in today’s market. Therefore, Fastmarkets has additionally increased its minimum tonnage requirements.

The new specifications are below, with the amendments in italics.

MB-LI-0012 Spodumene min 6% Li2O, spot price, cif China, $/tonne
Quality: A mineral concentrate accepted by buyers for conversion in lithium chemicals used in battery applications (any size will be accepted) and with the following chemical composition: Li2O 6% (min 5.0 Li2O and max 6.1% Li2O accepted if it can be normalized to 6%); Fe2O3 < 1.3% (max 1.5% Fe2O3 accepted if it can be normalized to < 1.3%), H2O < 10%
Quantity: minimum 3,000 tonnes
Location: cif China
Timing: 90 days
Unit: USD/tonne
Publication: Daily, 1pm London time

MB-LI-0043 Spodumene min 6% Li2O, contract price, cif China, $/tonne
Quality: A mineral concentrate accepted by buyers for conversion in lithium chemicals used in battery applications (any size will be accepted) and with the following chemical composition: Li2O 6% (min 5.0 Li2O and max 6.1% Li2O accepted if it can be normalized to 6%); Fe2O3 < 1.3% (max 1.5% Fe2O3 accepted if it can be normalized to < 1.3%), H2O < 10%
Quantity: minimum 5,000 tonnes
Location: cif China
Timing: up to 1 year
Unit: USD/tonne
Publication: Monthly, last Wednesday of the month, 3-4pm London time.

These prices are part of the Fastmarkets industrial minerals package.

The first publication of the prices with the new specifications will be Friday September 20.

To provide feedback on this price or if you would like to provide price information by becoming a data submitter to this price, please contact Callum Perry and Zihao Li by email at: pricing@fastmarkets.com. Please add the subject heading “FAO: Callum Perry/Zihao Li, re CIF China spodumene prices.”

Please indicate if comments are confidential. Fastmarkets will consider all comments received and will make comments not marked as confidential available upon request.

To see all Fastmarkets pricing methodology and specification documents, go to https://www.fastmarkets.com/methodology.

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