Belgium's Lithium Hydroxide Prices Decline Amidst Influx of Cheaper Imports; EV Sales Improve Despite Challenging Market Conditions

Antwerp, Belgium: The Lithium Hydroxide market in Belgium has continued its downward trend due to the influx of cheaper goods into the domestic market. The majority of the Lithium Hydroxide imported into Belgium comes from Russia and the United States. The prices of Lithium Hydroxide have continued to drop month-on-month, and from December 2023 to January 2024, the prices of Lithium Hydroxide DDP Antwerp dropped by more than 15%. As of January 2024, the assessed prices of Lithium Hydroxide battery grade DDP Antwerp were USD 15,750/MT.

The sector responsible for manufacturing lithium-ion batteries downstream has seen decreased demand, mainly because consumers are being cautious and adopting a wait-and-see attitude due to falling prices. Additionally, manufacturing companies have noted reduced profit margins, primarily due to the declining production costs of Lithium Hydroxide.

On the cost side, due to low-cost support from upstream raw materials such as lithium carbonate and spodumene, production costs have continued to decline, as reported by the exporting nations. The prices of upstream lithium carbonate dropped by more than 10% in January 2024. Besides the local market, both the North American and European markets were significantly impacted by the dominant Chinese market.

 According to industry experts, prices of battery-grade Lithium Hydroxide closely tracked those in Asia, with many observing that the market was either at parity or slightly higher. After declines in East Asia, Lithium Hydroxide prices experienced a slightly sharper drop, attributed to ample supply, as there was sufficient material available to meet consumer demand. Consequently, sellers had to adjust prices accordingly.

On the other hand, Eurostat, the statistical office of the European Union, shared data indicating that in 2022, there was a significant increase in the sale of battery-only electric cars in the EU. They reported that the number of these cars almost reached 3.0 million. This marks a 55% increase compared to 2021, bringing the total number of battery-only electric cars to 1.9 million.

According to the ChemAnalyst database, the prices of Lithium Hydroxide are anticipated to improve in the upcoming months as the supply chain operations enhance further; however, for the short-term outlook, the prices of Lithium Hydroxide are likely to see a further decline in the coming weeks, given the current challenging market conditions, persistently low demand across nations, and ongoing concerns surrounding the Lithium Hydroxide market. However, seeing the bigger picture, the proportion of battery-only electric passenger cars is anticipated to increase significantly in the years leading up to the 2035 EU prohibition on the sale of new combustion engine cars. This prohibition is connected to the Sustainable Development Indicator aimed at lowering CO2 emissions from new passenger cars.