According to the Zhitong Finance APP, Guosheng Securities released a research report stating that the recent fluctuations in lithium prices are mainly due to the "anti-involution" macro sentiment catalysis and supply concerns triggered by compliance issues with mining permits for lithium mines in Jiangxi due to the suspension of production at the Qinghai salt lake. The mining license for a leading mine in Jiangxi will expire on August 9, and the progress of renewal is still unclear. From September last year to February this year, the corresponding previous round of key mines was suspended, with lithium carbonate futures trading in the range of 68,000-88,000 yuan/ton. This supply disruption not only includes the unrealistic macro aspect of the suspension of production at the Jiangxi mica salt lake but also includes the unexpected macro aspect of the diffusion of license risks, coinciding with the traditional replenishment season. This round of supply disruption may drive lithium prices to break through previous highs.

The main points of Guosheng Securities are as follows:

Price: This week (August 4 to August 8), the price of electric carbon rose by 0.8% to 72,000 yuan/ton; electric hydrogen rose by 0.4% to 71,000 yuan/ton; lithium carbonate futures rose by 8.9% to 75,000 yuan/ton. The cost of spodumene rose by 2.9% to 777 USD/ton, with cost support at 73,200 yuan/ton (including tax), and lithium mica rose by 5.3% to 1,800 yuan/ton, with cost support at 81,200 yuan/ton (including tax).

Jiangxi mica disturbance fermentation, leading mines' suspension may cause quarterly supply tightness

Recently, the fluctuations in lithium prices are mainly due to the "anti-involution" macro sentiment catalysis and supply concerns triggered by compliance issues with mining permits for lithium mines in Jiangxi due to the suspension of production at the Qinghai salt lake. The mining license for a leading mine in Jiangxi will expire on August 9, and the progress of renewal is still unclear. This mine has an average monthly capacity of about 10,000 tons LCE. According to SMM, from January to July 2025, the average monthly surplus of Guojun lithium lake is 5,400 tons. If the aforementioned mine's suspension is implemented, combined with the traditional stocking in August, there may be a quarterly supply shortage in Guojun lithium lake, pushing lithium prices upward.

At the same time, in addition to the aforementioned large mine, there are still seven major lithium mines in Jiangxi with license flaws. According to SMM, the annual output of lithium extracted from mica in 2025 is about 200,000 tons LCE. Under extreme conditions, if all mines in Jiangxi are suspended, it may lead to annual supply-demand tightness.

Looking forward to the upward trend of lithium prices under supply-demand resonance

Supply disruption: From September last year to February this year, the corresponding previous round of key mines was suspended, with lithium carbonate futures trading in the range of 68,000-88,000 yuan/ton. This supply disruption not only includes the unrealistic macro aspect of the suspension of production at the Jiangxi mica salt lake but also includes the unexpected macro aspect of the diffusion of license risks, coinciding with the traditional replenishment season. This round of supply disruption may drive lithium prices to break through previous highs.

Cost increase: In Australia, in response to the downward trend in lithium prices, Australian mining operators have continuously adopted cost-reduction measures, including layoffs, improving selected grades and recovery rates, and reducing capital expenditures, which have basically exhausted the subsequent cost-reduction space. At the same time, since the pricing cycle was shortened last year, the price linkage between Australian mines and Guojun lithium lake has become tighter, and the mine side remains relatively strong compared to the lake side. From early July to now, electric carbon/spodumene has risen by 17%/24%, respectively. The upward movement of the cost side provides strong support for lithium prices.

Demand scheduling: This year, the downstream battery sector has performed better than expected. July is a traditional off-season, with Guojun lithium battery production at 144 GWh, up 37%/0.1% year-on-year/month-on-month, of which power batteries accounted for 93 GWh, up 34%/-1% year-on-year/month-on-month, and energy storage batteries accounted for 44 GWh, up 52%/+6% year-on-year/month-on-month; From January to July, the cumulative production reached 944 GWh, a year-on-year increase of 50%, of which power batteries accounted for 645 GWh, a year-on-year increase of 49%, and energy storage batteries accounted for 253 GWh, a year-on-year increase of 60%. It is expected that with the arrival of the traditional replenishment season in August, downstream demand may maintain a medium to high growth rate, which is favorable for lithium price elasticity.

Investment Recommendation

Guosheng Securities believes that low-cost resource supply + diversified non-lithium business operations are the current scarce competitive advantages in the industry. Enterprises with the aforementioned characteristics can rely on high-quality resources + integrated smelting to build a cost buffer, while non-lithium businesses smooth performance and support enterprise valuation. These enterprises are expected to navigate the industry downturn steadily and earn clearing profits when the landscape improves. Recommended target: Zhongkuang Resources (002738.SZ). Related targets: Tianqi Lithium (002466.SZ), Ganfeng Lithium (002460.SZ), YONGXING MATERIALS (002756.SZ).

Risk Warning

Supply exceeding expectations, demand falling short of expectations, changes in industry policies