China resorts to price fixing as lithium demand craters

 Reuters:

China's top lithium producers agreed this week to set a floor price of 250,000 yuan ($36,380) per tonne of lithium carbonate, six people familiar with the matter said, in an effort to slow a plunge in the price of the battery raw material.

The price was agreed on Tuesday by around 10 companies including Tianqi Lithium and Ganfeng Lithium that met on the sidelines of a conference in Nanchang in southern China, said one person who attended the meeting and five others briefed on the discussions.

The people declined to be named because of the sensitivity of the topic, which was discussed in a closed-door meeting.

Ganfeng said in a response to Reuters that no discussions on a floor price had taken place.

"Ganfeng always insists that product prices should be determined by the market, and will never take the initiative to control prices to influence the market," a company representative said in an email.

It added that no company in the industry has such capabilities.

Tianqi declined to comment.

Zhicun Lithium, one of the top lithium carbonate producers in China, was also represented at the meeting, said four of the people, but could not be reached for comment.

The move comes as lithium prices plunge on a significant slowdown in demand for electric vehicles (EV) in China, the world's largest EV market.

Spot prices have slumped by more than 60% since their peak in late November, with the decline picking up pace in recent weeks on a growing price war in China's auto market.
...

The demand for EVs other than Tesla appears minimal.  The batteries are probably the most expensive part of the car and replacing them is prohibitively expensive these days.

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