The listing of lithium carbonate futures today will have an impact on the new energy industry.

Several companies have expressed their intention to fully utilize the characteristics of the designated delivery warehouses for lithium carbonate, integrating the spot market, futures market, and delivery warehouses in an organic manner. This will further enhance their core competitiveness and risk resilience, promoting healthy development of the companies.

Lithium carbonate is an important raw material in the battery industry, serving as a primary component in the production of lithium-ion battery cathode materials.

The listing of lithium carbonate futures by GFEX today designates it as the benchmark deliverable product. So, how will its listing impact the industry chain?

01

What is Lithium Carbonate

Lithium carbonate is often referred to as the "industrial MSG" in traditional industries, and its significance in the new energy field has earned it the nickname "white petroleum".

Lithium carbonate is an inorganic compound. It is a white crystalline powder that is soluble in water. It is one of the most common compounds of lithium and finds wide applications in various fields.

Lithium-ion batteries are one of the commonly used battery types in electronic devices and new energy vehicles. The application of lithium carbonate enables lithium-ion batteries to possess characteristics such as high energy density, lightweight, high power output, and long lifespan.

At the same time, lithium carbonate can be classified into industrial-grade and battery-grade based on the lithium content. Industrial-grade lithium carbonate typically has a lithium content between 98% and 99%, while battery-grade lithium carbonate has a lithium content equal to or greater than 99.5%.

Industrial-grade lithium carbonate is commonly used in traditional chemical industries, where purity requirements are relatively low, and particle size is larger, typically ranging from 10 to 100 micrometers.

Battery-grade lithium carbonate is typically used in the production of new energy batteries. Therefore, it has higher purity requirements and smaller particle size, generally ranging from 1 to 5 micrometers. The high-purity lithium carbonate is needed for the internal chemical reactions in the battery, and the smaller the particle size, the better the battery performance.

02

The application of lithium carbonate

In recent years, the consumption of lithium carbonate has experienced rapid growth, with domestic consumption consistently ranking first. In 2022, the global demand for lithium carbonate reached 622,000 metric tons, with China accounting for 505,000 metric tons, or 81% of the total demand. China is the largest consumer of lithium carbonate worldwide.

Within the global consumption structure of lithium carbonate, lithium-ion batteries have become the largest consumer end-use due to their extensive applications in new energy vehicles, 3C electronics, and energy storage.

In 2022, lithium batteries accounted for as much as 80% of the demand for lithium carbonate. Looking ahead, with further development of downstream industries such as new energy vehicles and energy storage, the demand for lithium carbonate is expected to continue rising.

The listing of lithium carbonate futures may have an impact on the entire lithium battery industry. Through the lithium carbonate futures market, the industry can benefit from improved price discovery and risk management.

Futures trading provides an effective method for lithium battery companies to lock in future lithium carbonate prices, mitigating the risk of price fluctuations.

The lithium carbonate futures market can assist the industry in better managing the supply chain and production planning. Through futures trading, lithium battery companies can more efficiently conduct raw material procurement and supply chain management, reducing supply chain risks and uncertainties, and making more accurate predictions and plans regarding demand and supply.

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The presence of the futures market can provide investors with more investment opportunities and market participation methods, further promoting the development of the lithium battery industry and capital flow.

The listing of the lithium carbonate futures market may have an impact on the price of lithium carbonate.

Market participants engage in buying and selling prices through futures trading, adjusting prices based on market supply and demand conditions and market expectations. This may lead to changes and fluctuations in the price of lithium carbonate, thereby affecting the development of the downstream industry chain.

03

What is the future development like?

Lithium carbonate is an important raw material for lithium-ion batteries, which are the core technology in the field of new energy such as electric vehicles and renewable energy storage systems.

In the future, with technological advancements, the energy density of lithium-ion batteries will further increase, charging times will be reduced, cycle life will be extended, and safety performance will be more reliable. This will further drive the development of the new energy sector.

With increasing environmental protection demands and government restrictions on traditional fuel-powered vehicles, the electric vehicle market will continue to expand. Lithium carbonate batteries, as the power source for electric vehicles, will benefit from the rapid growth of the electric vehicle market.

It is expected that in the future, lithium carbonate batteries will further improve energy density and charging speed, reduce costs, increase battery lifespan, and accelerate the popularization of electric transportation.

Lithium carbonate will also play an important role in the development of sustainable energy. Renewable energy sources, such as solar and wind power, can benefit from lithium carbonate as a key component in energy storage systems, addressing the issue of stability in renewable energy sources.

Additionally, lithium carbonate can also be used for energy storage in solar photovoltaic cells and wind turbines, enhancing the efficiency of energy utilization.

In conclusion, the future development of lithium carbonate in the field of new energy will benefit from technological innovation, expanding market demand, and policy support.

With further advancements in sustainable energy and global emphasis on environmental conservation, lithium carbonate, as a key material in the new energy sector, will continue to play a crucial role and encounter broader opportunities for development.