CITIC Securities said last week’s sharp fall in lithium prices was driven by SMM
(Shanghai Metals Market) revisions to lithium carbonate inventory scope and
sample coverage, which created a large weekly inventory spike, not by a material
deterioration in industry fundamentals. It expects a September pickup in
lithium-battery production to deliver substantial incremental demand while
overseas supply additions lag, likely widening the supply deficit. Single-week
inventory noise is unlikely to change the industry picture; CITIC views prices
as clearly oversold and expects them to stabilise and rebound to 150,000-200,000
yuan/ton, supporting a recovery in lithium-sector stocks.
