The average market price of Chinese battery-grade (99.5%) lithium carbonate has dropped further over the past week. 

According to 100ppi's data, on 16 December, the price was at CNY 569,000 ($81,633.65)/tonne, a decline of about 3.07% from 1 December's CNY 587,000/t and a decline of about 1.56% from 9 December's CNY 578,000/t. Over the past week, the price remained at CNY 578,000/t on Monday 12 December, and fell to CNY 574,000 t/y on 13 December. It then dropped to CNY 571,000 t/y on 14 December and later had another drop and stayed at CNY 569,000 t/y for 15 December and 16 December. 

According to data from Bai Info, the price had an on-month decline of about 3.57%. 

On 14 December, Pilbara Minerals completed its 12th spodumene concentrate auction. It says in its announcement: "The company has sold two cargoes for a combined total of 10,000 dry metric tonnes at an average price of $7,552/dmt (5.5%, FOB Port Hedland basis). The equivalent 6%-grade price negotiated equates to a price inclusive of freight, CIF to China of US$8,299/dmt, with deliveries expected from late January 2023."

The average price $7,552/dmt is a 3.24% on-month decline from November's $7,805/dmt. Some said the decline is related to negative sentiments towards Covid-related uncertainties in China and news about procurement/production reduction from CATL, Kallanish notes. 

According to Oilchem, given the freight expense of $90/t and the processing fee of CNY 30,000/t, the cost of battery-grade lithium carbonate would then be about CNY 549,800/t for Chinese companies. 

Insiders said that the decline in the auction price showed a signal of loosening for lithium prices, reflecting the industry's resistance to high lithium prices. Lithium prices may gradually fall back to normal levels. The declines in upstream lithium ore and lithium carbonate prices are expected to reduce downstream costs.