Global Business, BICHEM Group
In the past decade, lithium price, like riding on a roller coast, has experienced two rounds of ups and downs.
Round I：October 2015 to September 2020
Between October 2015 and December 2017, the price of lithium carbonate rocketed from ￥5,000 to ￥17,000 per tonne—a staggering increase of 240% over 26 months. This surge was driven by two principal forces. On the demand side, robust government subsidies in China fuelled an EV boom, with its sales tripling year on year to 260,000 units in 2015. On the supply side, production was hampered by concentrated sources and unexpected disruption: severe flooding in South America in late March 2015 dealt a heavy blow to output from salt-flat operations.
However, as increasing of production of carbonate lithium and the canceling of policies support, lithium price has declined by 76%, to ￥40 thousand per tonne until September 2020.
Round II: September 2020 till Now
From September 2020 to November 2022, lithium price surged 14 times, from 40 thousand CNY/ Ton to 600 thousand CNY/ Ton mainly because of demand increase of EVs globally. In 2021 and 2022, increment of EVs registered 2.15 million units and 3.36 million units respectively. Additionally, affected by the depressed lithium price in the past few years, many companies halted capacity expansion, which limited lithium supply and boost the increase of lithium price in return.
Since November 2020, lithium producers fully expand their production as lithium price soaring, which once again causes overcapacity, and lithium price has slumped by 90%, from ￥600 thousand per tonne to ￥60 thousand per tonne.
Until now, the lithium price has been adjusted for almost 32 months, yet the current price (￥60 thousand per tonne) only hits the cost line of spodumene, which is higher than that of brine-lithium-extraction. Besides, due to the profit gained earlier (between 2021 to 2023), none of mining companies is found bankrupted. Thus, the clearing period of this round is expected to last longer.
The Future of Lithium Market
In the first half of this year, market of energy storage continues its soaring momentum. Various factors including the steady growth of installed capacities of U.S. and EU, the implementation of India’s compulsory energy storage allocation policy, the accomplishment of Indonesian integrated photovoltaic power and energy storage, and the subsidiaries rolled out by the Australian government drives the speedy growth of this industry. However, developments of emerging industries like solid-state batteries, low-altitude economy remain sluggish, thus, great demand surges requires more time.
Despite growing demands, the overly supplied lithium still hinders the sharp increase of lithium price. Currently, multiple lithium projects are still ramping up/ in expansion, and brine-lithium-extraction is in peak season. Thus stock of carbonate lithium remains at a high level.
In June 2025, the yield of carbonate lithium is 78.1 thousand tonne (increased by 8.3 month on month, and 17.9% year on year). In the first half of 2025, the total yield of carbonate lithium registered 429.6 thousand tonne (increased by 43.9% year on year), set a record high.
On July 17, 2025, China’s weekly report of carbonate lithium stock is 142620 tonne, increased by 1827 tonne (+13%) month on month. This number is still increasing.
There are still some disruptions in lithium production including the temporary pause of Zangge’s salt lake project, and the official suspension of Cattlin project of Rio Tinto, and other potential “anti-involution” policies.
To sum up, the dawn of lithium market has come, but the final reversal still requires further observation.
To analyze whether lithium price will witness a short rebound or a lasting reversal requires close observations on crucial variables including technological outbreaks for solid-state batteries, the enforcement of China’s “anti-involution” policies, and the pace of the Fed’s rate cuts.