Gasgoo Munich- The China Nonferrous Metals Industry Association's Lithium Branch recently released its report on the lithium sector for January 2026. Prices for lithium carbonate surged that month, fueled by shifting policy expectations and supply-demand adjustments. Trading activity gained momentum, while the spread between futures and spot prices widened in tandem.
Supply remained largely steady, though some cathode material producers paused for maintenance ahead of the Lunar New Year, putting a squeeze on short-term availability. On the demand side, policy drivers took the lead. The extension of national subsidies for new energy vehicles bolstered market confidence, while news that export tax rebates for lithium batteries will drop from 9% to 6% in April spurred overseas clients to front-load orders. The result: a concentrated rush to ship in the first quarter.
Data shows domestic lithium carbonate on a volatile upward trajectory in January. Battery-grade spot prices climbed from 119,000 CNY per ton at the start of the month to 152,500 CNY by the end—a 28.15% surge. Industrial-grade prices followed suit, rising 26.69% to 149,500 CNY per ton from 118,000 CNY. Futures markets mirrored the move, with the most-active contract settling at 148,200 CNY per ton, up 14.02% from 130,000 CNY.
Notably, spot gains outpaced futures, indicating that physical restocking demand is running hotter than long-term expectations. The widening price gap between top-tier and second-tier supplies also suggests a split in downstream willingness to pay for quality stability.
This price swing is no isolated event. On January 9, the Ministry of Finance and the State Taxation Administration of China confirmed a phased reduction in export tax rebates for batteries: the rate drops to 6% from April 2026 through year-end, before vanishing entirely in 2027. The policy aims to curb exports of low-end capacity and cut-throat price competition. Analysts note that the first quarter is shaping up to be busier than the typical seasonal lull, suggesting short-term support for lithium carbonate prices will hold.
