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April 6 (NBD) -- The Chinese new energy industry chain is experiencing an upheaval. As a market barometer, the battery-grade lithium carbonate price came in at 224000 yuan a ton on Tuesday, down over 60% from its last November high of 580000 yuan a ton. 

In face of a sharp daily price decrease of nearly 10000 yuan, half of the four major lithium extraction enterprises in Yichun, Jiangxi Province, have halted production, reported The Paper on Wednesday.

It is learned that in 2021, the lithium carbonate production in Yichun, Jiangxi province, reached 81,000 tons, accounting for more than a quarter of the country's total. As of July 2022, the production capacity of lithium carbonate there has reached 180,000 tons, accounting for 40% of the country's total production capacity of approximately 450,000 tons.

In addition to the sharp drop in the price of lithium carbonate, prices of other products in the lithium battery industry chain, such as lithium hexafluorophosphate electrolyte, electrolytic cobalt, battery-grade nickel sulfate, and battery-grade manganese sulfate, have also shown a downward trend recently. 

It is reported that recently, at a closed-door meeting of Nanchang lithium producers, major domestic lithium producers such as Ganfeng Lithium and Tianqi Lithium agreed to a floor price of 250,000 yuan per ton for lithium carbonate to ease price fluctuations. Although officials of Ganfeng Lithium have denied this, the company later said that long-term contract customers account for about 70%-80% of the total. In order to ease price fluctuation, price adjustments will be conducted on a monthly and quarterly basis. 

Ganfeng Lithium have confidence in lithium prices when it accepted investors, saying that there is still a huge demand for electric vehicles. At present, the concentration of spodumene suppliers in Australia is high, and the ore price is not expected to fall in the short term. Given that capacity of lithium from lepidolite and salt lakes, will not be increased rapidly recently, there may be little room for further downward pressure on lithium salt prices.