CITIC Securities: Inventory continues to be destocked, demand is gradually increasing, and lithium prices are easy to rise but hard to fall

CITIC Construction Investment pointed out that, according to SMM, domestic lithium carbonate inventories continue to decline, with the rate slightly slowing. During the week, inventories decreased by 414 tons to less than 99,000 tons, including a reduction of 1,184 tons at smelting plants to 16,000 tons, reaching the lowest level in nearly three years. Downstream inventories fell by 1,890 tons to 46,000 tons, with estimated available inventory days less than 10. Inventories at other stages decreased by 1,120 tons to 37,000 tons, also at relatively low levels. On the supply side, weekly lithium carbonate production increased by 768 tons, but considering Zimbabwe’s halt of exports and port ore stock levels, future supply flexibility is expected to be limited. On the demand side, consumption continues to recover, with energy storage and heavy truck demand remaining strong. Power battery consumption is gradually entering peak season. Coupled with the Middle East war, overseas energy pressures are highlighted, and European household storage demand is rising. It is expected that in the next quarter, low inventories will remain the core issue, making lithium prices more likely to rise than fall.