In recent terms, China observed severe turmoil in the market dynamics after a rapid resurgence of COVID in numerous provinces resulted in a stricter implementation of lockdown to curb the paced spread of COVID in China. In repercussions, it restricted the movement of a vast number of the population besides halting the non-essential and industrial activities in the Chinese domestic market. The loading and offloading activities at major ports were delayed and the congestion piling up as of now the traffic exceeded by 500% than the normal congestion at the Chinese ports. Overall developments in the Chinese domestic market had induced several uncertainties in the EV battery raw material market.

Overall, the benchmark of the several key EV battery commodities was not identical with each other, and the spread between several key commodities narrowed sharply after the number of positive cases soared in a short term. Although, by taking detailed evaluation, the Chinese authorities permit the offices and industries in Shenzhen to operate by taking preventive measures. In addition, the soaring Lithium prices have caught the attention of the Chinese regulators, and to ensure stable supply and promote the healthy development of the new energy vehicles, China’s MIIT with NDRC organized a symposium on the operation of the Lithium industry.    

As a ripple effect, it supported the morale of Lithium manufacturers as the overseas inquiries remained persistent and had a direct but inverse impact on the spread of Lithium Carbonate and Lithium Hexafluorophosphate in China. In the mid of March, the prices of Lithium Hexafluorophosphate observed a sudden plunge of -2.43% on a week-on-week basis in China, despite the constant support from the feedstock Lithium Carbonate. Such sudden changes in the spot market were driven by the uncertain demand outlook amidst the resurgence of COVID in China, which levied an indirect impact on the quotations of Lithium or EV batteries raw material offers globally.

As per ChemAnalyst, the current market dynamics of global Lithium is currently hovering with the numerous uncertainties in the Chinese domestic market amidst the resurgence of COVID and the organized symposium on the operation of the Lithium industry. Therefore, it is anticipated that the market sentiments will observe a constant stagger in the upcoming period.