Recently, the lithium carbonate market, one of the core raw materials in the new energy industry chain, has experienced sharp volatility, with both futures and spot prices fluctuating significantly, drawing widespread attention across the industry. In March 2026, lithium carbonate prices exhibited a “roller-coaster” pattern, with the main futures contract briefly falling below RMB 150,000/ton (USD 21762.15/ton) to around RMB 140,000/ton (USD 20311.34/ton) before rebounding rapidly. Market dynamics have been shaped by intensified long-short competition, as participants seek a new equilibrium amid low inventories, supply disruptions, and diverging demand.
On March 19, the main lithium carbonate futures contract dropped sharply by 6.37% to RMB 142,600/ton (USD 20688.55/ton), once again falling below the key threshold of RMB 150,000/ton (USD 21762.15/ton) for the year. Spot prices followed suit, with the average price of battery-grade lithium carbonate declining below RMB 150,000/ton (USD 21762.15/ton). By March 24, the main contract rebounded strongly, rising by more than 6% and reclaiming the RMB 150,000/ton (USD 21762.15/ton) level. Within just a few days, price fluctuations exceeded RMB 10,000/ton (USD 1450.81/ton), reflecting rapid shifts in market sentiment driven by macroeconomic and fundamental factors.
Sharp price fluctuations driven by macro and industry factors
The recent volatility in lithium prices is the result of both macroeconomic influences and industry fundamentals. On the macro side, escalating geopolitical risks in the Middle East have pushed up global oil prices and increased volatility in international capital markets. Commodities, including lithium carbonate, have faced sentiment-driven sell-offs, with risk aversion rising significantly. At the same time, tighter regulation in the futures market and the withdrawal of speculative capital have amplified price swings, contributing to a rational correction from previously elevated levels.
From an industry perspective, the lithium carbonate market currently presents a complex structure characterized by “low inventory, tight balance, and weak spot demand”. On the supply side, domestic production is steadily recovering, easing short-term supply pressure, while overseas disruptions persist. In February, Zimbabwe announced a ban on lithium concentrate exports, and compliant enterprises are currently undergoing export licensing procedures. If exports fail to resume normally in April, domestic lithium ore supply could tighten significantly in May. At present, raw material inventories at domestic smelters are sufficient to support only about two months of production, offering limited buffer capacity.
Diverging supply-demand dynamics
Inventory data show that as of March 19, China’s total social inventory of lithium carbonate had fallen to 98,900 tons, with fewer than 25 days of available supply, near a three-year low, providing some price support. However, downstream cathode material producers have begun to build up inventories, and procurement enthusiasm has weakened, reflecting subdued real demand.
Demand trends are notably divergent. From January to February 2026, domestic new energy vehicle (NEV) sales declined by 27.5% year-on-year, weighing on short-term power battery demand. However, the rising share of new energy commercial vehicles has driven a 32.3% increase in battery capacity per vehicle, and strong export growth has partially offset the demand gap. Meanwhile, the energy storage sector has emerged as a new growth driver. Against the backdrop of accelerated global energy transition and high oil prices, demand for energy storage continues to expand, becoming an important pillar supporting lithium carbonate demand. Industry consensus holds that, in the long term, lithium prices will remain fundamentally driven by supply and demand, with geopolitical conflicts exerting only marginal effects.
Outlook
Market institutions generally expect lithium carbonate prices to continue exhibiting wide fluctuations in the short term. Low inventories and overseas supply disruptions provide downside support, while spot market transactions are expected to recover gradually as prices decline. However, once prices rise to certain levels, increased hedging activities across the industry, combined with the continued release of domestic production capacity, will likely cap upward momentum.
Amid ongoing volatility in the lithium carbonate market, technological innovation has become a key lever for the industry chain to mitigate risks, reduce costs, and improve efficiency. BICHEM believes that current price fluctuations highlight the critical value of technological advancement in the lithium sector. Short-term volatility does not alter the long-term strategic importance of lithium resources, and technological upgrading remains the core driver of high-quality industry development. Going forward, BICHEM will continue to advance direct lithium extraction (DLE) technologies, promoting efficient, green, and scalable brine lithium extraction, supporting cost reduction and supply security in China’s lithium battery industry chain, and providing stable and reliable lithium resources for the global new energy sector.
