1、 Price trend

According to the analysis system of the commodity market of Shengyishe, as of March 7th, the price of high-quality power grade lithium iron phosphate is 43240 yuan/ton, and the price of lithium iron phosphate has shown a steady increase, with a weekly increase of 0.56%. After the holiday, the demand for lithium iron phosphate in the market has improved, and in March, sales of new energy vehicles have slowly recovered. The upstream raw material end has shown a strong trend, and currently, the lithium iron phosphate market is showing obvious benefits.

2、 Market analysis

In February, the production and sales of lithium iron phosphate were affected by the Spring Festival holiday, and terminal demand slowly recovered. The inventory of new energy vehicles was relatively high, mainly based on consumption inventory. After the holiday, it entered March, and the demand for new energy vehicles steadily increased. The upstream raw material lithium carbonate market rebounded, boosting the overall industry chain and strengthening the confidence of positive electrode material enterprises. Leading enterprises increased by about 40%, and the increase in raw material prices drove up the price of lithium iron phosphate, At present, the downstream demand side is improving, orders are increasing, and the overall trend is mainly strong.

In terms of cost: On March 6th, imported lithium ore prices increased by 50-250 yuan/ton, domestic lithium ore prices increased by 50-150 yuan/ton, and lithium ore prices ranged from 100 yuan/ton to 200 yuan/ton within the week. Currently, upstream carbonate prices have continued to rise for several days, and the market transaction atmosphere is improving. Lithium iron phosphate has strong support on the cost side, with prices passively rising and mainly rising.

In terms of demand: Currently, the new energy vehicle sector continues to improve, but the growth rate has slowed down. According to the latest data from the China Association of Automobile Manufacturers, in January 2024, China’s new energy vehicle production was 787000 units, with sales of 729000 units, an increase of 85.3% and 78.8% year-on-year, respectively. In January, the market share of new energy vehicles reached 29.9%. In February, wholesale sales of new energy passenger vehicle manufacturers in China reached 450000 units, a decrease of 9% year-on-year and 34% month on month. There were relatively few working days in February, Due to the relatively weak automobile consumption before and after the Spring Festival holiday, sales in February showed a downward trend. Entering March, sales of new energy vehicles rebounded, and it is expected that retail sales of new energy vehicles in March will be around 560000 units, a month on month increase of 27.5%, a year-on-year increase of 25.8%, and a penetration rate of about 35.2%.

3、 Future Market Forecast

In summary, against the backdrop of the rapid development of new energy vehicles, as the main raw material for producing lithium batteries, the demand for lithium iron phosphate will continue to grow, and downstream demand will skyrocket. Currently, the price of upstream lithium carbonate is hovering around the cost line, and there will be no major decline in the short term. The main trend is to maintain stability, strength, or narrow upward trend. Therefore, the price of lithium iron phosphate is prone to rise but difficult to fall in the short term.