Lithium carbonate prices rebound sharply in July; storage cell prices edge up

Lithium price

Supply disruptions push prices higher; lithium carbonate to see short-term inventory drawdown.

Spot prices for battery-grade lithium carbonate stood at RMB 68,000-70,000/MT as of July 31, 2025, averaging RMB 69,000/MT at the month’s end, up 11.7% MoM. CIF prices for Chinese lithium spodumene concentrate (SC6) sat at USD 755-774/MT, averaging USD 765/MT, up 21.3% MoM.

Lithium salt prices saw notable volatility in July, with a sharp rebound followed by a slight pullback. On July 31, the lithium carbonate futures contract LC2508 closed at RMB 68,000/MT, up 8.9% MoM; LC2509 closed at RMB 68,300/MT, up 9.7% MoM.

The recent sharp rebound in lithium carbonate prices has been primarily driven by policy signals from central authorities promoting “anti-price war,” alongside multiple announcements of production halts among suppliers.

On July 7, the Yichun City Natural Resources Bureau issued a directive requiring eight local lithium mines to submit Reserve Verification reports by September 30, raising market concerns over the production stability of some lepidolite mines in Jiangxi Province.

On July 17, Zangge Mining disclosed that its subsidiary, Golmud Zangge Lithium, was ordered to suspend production for rectification due to alleged illegal mining activities.

On July 25, Yichun Silver Lithium New Energy announced a planned 26-day maintenance shutdown.

Together, these developments have contributed to a stronger-than-anticipated surge in lithium carbonate prices.

Looking ahead to August, the market has largely priced in earlier production cut expectations, resulting in a moderation of bullish sentiment. Due to downstream cathode manufacturers’ resistance to elevated raw material costs, the lithium carbonate market is expected to enter an inventory drawdown phase once production cuts take effect. In the short term, prices may remain range-bound.
 

Energy-storage cell price

LFP cell prices rise slightly due to cost changes amid strong market sentiment.

In July, price quotes for LFP cells in China continued to trend upward. The after-tax price for 280 Ah LFP cells ranged RMB 0.26-0.33/Wh, with the average rising 1.7% MoM to RMB 0.295/Wh. After-tax prices for 314 Ah LFP cells came in at RMB 0.25-0.34/Wh, with the average price rising 1.7% MoM to RMB 0.295/Wh. The after-tax price range for 100 Ah LFP cells was RMB 0.33-0.40/Wh, with average price staying flat MoM at RMB 0.365/Wh.

Driven by the rebound in lithium carbonate prices, LFP prices rose 8% MoM, pushing up the unit cost of energy storage cells and providing short-term support for cell prices.

The energy storage market remains strong. On July 29, China and the U.S. agreed to extend the suspension of the 24% reciprocal tariffs and China’s countermeasures, with current tariff policies likely to be extended by another 90 days.

The One Big Beautiful Bill Act (OBBBA) passed in early July extended the deadline of energy storage Investment tax credits (ITC) from 2032 to 2036, lengthening the policy support window and stabilizing market expectations. However, for energy storage projects starting between 2026 and 2030, the costs sourced from non-Foreign Entities of Concern (FEOC) must be at least 55% in 2026, with the rate rising 5% each year until 2030 to 75%. As a result, U.S. energy storage installations are expected to accelerate throughout 2025.

On July 14, the Gansu Provincial Development and Reform Commission released the “Notice on Establishing a Generation-side Capacity Tariff Mechanism in Gansu Province (Exposure Draft).” The policy aims to be implemented alongside the province’s power spot market and proposes a provisional capacity tariff of RMB 330/kW-year for coal-fired units and grid-side new ESS, with a two-year implementation cycle.

As provincial implementation of Document 136 gradually takes effect, the profit model for the energy storage sector is becoming clearer and more optimized. Improved earnings prospects are expected to further drive demand, supporting strong medium- to long-term growth potential in China’s storage market.