Lithium carbonate futures in China retreated to CNY 155,000 per tonne, down from a one-month high of CNY 175,000 reached in late February, amid signs of weakening demand. Fresh data showed that electric vehicle sales at leading Chinese manufacturer BYD plunged 40% year-on-year in February, reversing the growth seen in previous months and raising concerns that China’s EV market may be losing momentum.
The figures have intensified worries that higher energy costs, driven in part by the conflict in the Middle East, could discourage major manufacturers from building up inventories of input materials, prompting a broader pullback in industrial metals.
On the supply side, however, Chinese output is also expected to remain constrained by Beijing’s campaign against overcapacity and excessive competition. Authorities have already revoked 27 mining permits in the lithium-rich province of Jiangxi, following the earlier suspension of operations at CATL’s Jianxiawo lithium mine. In addition, Zimbabwe has halted exports of lithium concentrates to push consumers to establish refining facilities within the country.
