Yangtze River Nonferrous: Lithium Carbonate Price Declined on the 18th, Weak Outlook Expected and Risk Aversion Sentiment Intensified

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Futures: On March 18, 2026, the domestic lithium carbonate futures market was hit hard by a bearish wave, resulting in a “free fall” scenario. The main contract 2605 of Guangzhou Futures Exchange opened at 155,000 yuan/ton, reaching a high of 156,840 yuan/ton during the session, then steadily declined, with a low of 149,700 yuan/ton. The settlement price was 152,300 yuan/ton, down 6,960 yuan or 4.43% from the previous trading day’s settlement price (157,080 yuan/ton). Trading volume increased to 205,884 lots, while open interest decreased by 1,180 lots to 307,662 lots, indicating some long positions exited the market after the price broke support levels.

Spot Market: According to the latest spot data released by Yangtze Gold Silver & Copper Network on March 18, 2026, the domestic lithium carbonate market experienced a correction from high levels. The spot price for battery-grade lithium carbonate (99.5%) was 154,000 yuan/ton, and industrial-grade lithium carbonate (99.2%) was 152,000 yuan/ton, both down 2,500 yuan from the previous day, representing approximately 1.60% and 1.64% daily declines respectively.

Market Overview: Futures and Spot Prices Decline Together, Market Sentiment Turns Sour Today’s decline is not an isolated event but a result of synchronized weakness across futures, spot, and stock markets. On the futures side, the main contracts saw significant intraday drops, with technical indicators weakening. The spot market also faced pressure, with prices for related grades falling compared to the previous day. Data shows that the benchmark price for industrial-grade lithium carbonate has retreated since the beginning of the month. The lithium mining sector in A-shares also declined across the board, with leading stocks falling by notable margins.

Analysis of Causes: Weakening Expectations and Risk-Averse Market Sentiment The sharp decline was mainly driven by weakening market expectations and rising macro risk aversion. Although the supply-demand fundamentals have not fundamentally reversed and social inventories are still being depleted, concerns about future demand have gained prominence. The core issue is the growth outlook for downstream new energy vehicle sales. Market fears that slowing terminal growth will transmit upstream, reducing the willingness of cathode material and battery manufacturers to restock, shifting from “buying on dips” to “cautious waiting.” This “buy low, sell high” psychology further exacerbates negative feedback in the market.

Fund Flows Provide Direct Evidence: Post-market data shows that the day’s trading was dominated by long liquidation, indicating that profit-taking long positions exited after prices broke key support levels, mainly driving the decline. Although trading volume increased, open interest decreased, reflecting short-term trading behavior and lack of confidence in long-term holdings amid market uncertainty. Additionally, the high level of exchange-held warehouse receipts suggests potential delivery pressure.

On the macro front, recent geopolitical risks have disturbed the overall sentiment in commodities markets, causing funds to shift from related sectors to safer or more certain areas, adding to the selling pressure on lithium carbonate. Most domestic commodity futures closed lower today, creating a generally bearish atmosphere.

Future Outlook: Volatility in Search of a Bottom, Focus on Demand Verification and Cost Support In the short term, the lithium carbonate market has entered a phase dominated by sentiment-driven weak oscillations. Technically, after breaking key support levels, prices need time to find a new balance. Fundamentally, the upcoming sales data for new energy vehicles will be a key validation point. If sales remain strong, the current decline based on pessimistic expectations may be corrected; if not, prices could continue to be under pressure.

Cost-side support remains important: Current raw material prices remain relatively high, providing solid cost support for lithium carbonate. Supply is not infinitely loose either. Industry data shows that domestic lithium carbonate production last month decreased month-on-month, although weekly output has rebounded this month, overall supply growth remains controlled. In the medium to long term, the growth logic of new energy vehicles and energy storage industries remains unchanged, and the supply-demand balance is expected to persist.

Overall, after a rapid decline, lithium carbonate prices may have limited further downside, but an immediate reversal lacks momentum. The market may enter a phase of range-bound oscillation, digesting negative sentiment. Investors should closely monitor changes in downstream production and procurement, warehouse receipt registration and cancellation, and macroeconomic shifts. It is recommended to adopt cautious, range-based strategies and avoid chasing rallies or selling in panic during emotional market swings.

[Personal opinion, for reference only, not investment advice]