TrendForce reports that demand for EV batteries remained stable in July. However, the continued price decline for cathodes—coupled with falling prices for battery metals such as cobalt, nickel, and particularly copper—led to a reduction in the cost of battery materials and a slight drop in battery cell prices. In July, the prices of EV cells decreased by 2% compared to June. Monthly ASP for square ternary, square LFP, and pouch ternary EV battery cells were CNY 0.48/Wh, 0.41/Wh, and 0.50/Wh, respectively.
Market orders for ESS batteries weakened in July, and the industry’s production volume declined compared to the previous month. Additionally, prices for raw materials such as cathode materials, electrolytes, and copper foil all experienced varying degrees of decline, which made it difficult to support ESS battery prices. Furthermore, the shipment proportion of large-capacity cells (>280 Ah) with greater cost advantages has continued to increase. Consequently, the ASP for LFP ESS cells fell to about CNY 0.38/Wh in July—a monthly decrease of 9%.
TrendForce indicates that there is still significant pressure from oversupply in China’s lithium carbonate market. By the end of July, lithium carbonate prices had fallen to around CNY 80,000 per ton due to weak market conditions, but the reduction in supply was not substantial. Given the accelerated decline in market demand, the oversupply remains unchanged. It’s estimated that lithium carbonate prices will continue to fluctuate and hit new lows in the third quarter.
Notably, the implementation of tariff policies in overseas markets such as the US triggered a bout of restocking among cell makers in late July. This forward shift in demand is expected to increase upstream orders in the supply chain in August. Although the downward trend in lithium prices is expected to continue, the rate of decline may slow down.
