Impact of Lithium Price Slump on Chinese Battery Giant CATL

Chinese battery giant CATL plans to adjust its lithium production in Jiangxi province due to a slump in lithium prices. High costs of producing the battery material from lepidolite have led the company to make changes. The announcement comes after an analyst report and inquiries from Reuters.

Chinese battery giant CATL plans to adjust its lithium production in the southern province of Jiangxi, the company said on Wednesday.

A slump in prices of the metal, used mainly for electric vehicle and solar batteries, has led many global lithium producers to scale back production and cut jobs. The massive CATL-owned lithium mine in Yichun city, Jiangxi province, is partly responsible for the rapidly growing supplies in China.

Analysts stated that the cost of producing battery material from lepidolite, a hard type of lithium ore, is too high. 'Based on recent lithium carbonate market conditions, the company plans to make adjustments in lithium carbonate production in Yichun,' CATL informed Reuters on Wednesday after Asian trading hours.

The statement was in response to Reuters' inquiries following an analyst report indicating that CATL had suspended its large lepidolite mine, a development that influenced lithium futures prices and the shares of some global companies.

(Exchange rate: $1 = 7.1118 Chinese yuan renminbi)

(With inputs from agencies.)