Group 1 - The security of critical mineral supply chains has become a forefront area of global geopolitical and economic competition, with major economies seeking to reduce strategic dependencies and enhance self-sufficiency in critical supply chains [1][2] - Since 2017, the United States has initiated a process to rebuild critical mineral supply chains, aiming for independence from geopolitical competitors like China, while the EU emphasizes diversification without fully decoupling from China [1][2][34] - The G7 summit in June 2025 highlighted the collaboration among the US and its allies to address China's export controls on critical minerals, particularly rare earths, and initiated a "Critical Minerals Action Plan" [2][30] Group 2 - Critical minerals are defined as non-fuel minerals essential for economic and industrial development, with supply disruptions posing significant risks to economic and national security [3][4] - The list of critical minerals varies by country, with the US identifying 50 minerals in its 2022 final list, while the EU confirmed 34 critical raw materials in its 2024 legislation [4][6] - The global distribution of critical minerals is highly concentrated, with a few countries holding significant reserves and production, leading to increased strategic importance and resource nationalism [7][10] Group 3 - The US has implemented various legislative measures to enhance domestic resource development and strategic reserves, including the Defense Production Act and multiple key mineral-related acts [24][26] - The US has invested over $439 million since 2020 to support the rare earth supply chain, focusing on developing a complete supply chain from mining to processing [27][30] - The US aims to establish a global supply chain network for critical minerals through partnerships and agreements with resource-rich countries, while also increasing tariffs on imports from China [30][31] Group 4 - The EU's strategy emphasizes reducing reliance on single countries and diversifying supply chains, while still maintaining trade relations with China [34][35] - The EU has introduced the Critical Raw Materials Act to enhance local production capabilities and reduce dependency on third countries, aiming for a significant portion of consumption to be met by domestic sources by 2030 [35][36] - The EU is actively limiting Chinese investments in its critical mineral projects through regulatory measures and environmental standards [37] Group 5 - China is responding to the US and EU strategies by consolidating its critical mineral industry, enhancing domestic exploration and investment, and implementing export controls [38][39] - The country has initiated significant investments in mineral exploration and established strategic reserves to secure its supply chains [39][40] - China is also engaging in global resource diplomacy and infrastructure investments to strengthen its position in critical mineral supply chains [41][42]

Report Industry Investment Rating - Not provided Core View of the Report - The main lithium carbonate futures contracts fluctuate around 60,000 yuan/ton. Fundamentally, weekly supply decreases, demand remains stable, showing a slight upward trend. Downstream acceptance of current prices is low, spot trading volume is small, and terminal prices continue to decline. It is expected that the futures price will be weak in the short term [3] Summary by Relevant Catalogs Lithium Compounds - SMM battery - grade lithium carbonate average price is 60,900 yuan, down 600 yuan; SMM industrial - grade lithium carbonate average price is 59,300 yuan, down 600 yuan [1] Lithium Ore - Lithium spodumene concentrate (CIF China) average price is 677 yuan, down 3 yuan; lithium mica (Li20:1.5% - 2.0%) average price is 690 yuan, down 10 yuan; lithium mica (Li20:2.0% - 2.5%) average price is 1210 yuan, down 25 yuan; phosphorus lithium aluminum stone (Li20:6% - 7%) average price is 5840 yuan; phosphorus lithium aluminum stone (Li20:7% - 8%) average price is 6815 yuan, down 85 yuan [1][2] Cathode Materials - The average price of lithium iron phosphate (power type) is 30,520 yuan, down 145 yuan; the average price of ternary material 811 (polycrystalline/power type) is 145,010 yuan, down 260 yuan; the average price of ternary material 523 (single - crystal/power type) is 115,085 yuan, down 250 yuan; the average price of ternary material 613 (single - crystal/power type) is 122,335 yuan, down 220 yuan [2] Price Spreads - The electric carbon - industrial carbon spread is 1600 yuan, unchanged; the electric carbon - main contract spread is 2040 yuan, up 920 yuan; the near - month - consecutive one spread is 60 yuan, down 40 yuan; the near - month - consecutive two spread is - 260 yuan, down 100 yuan [2] Inventory - The total inventory (weekly, tons) is 131,571 tons, down 208 tons; the smelter inventory (weekly, tons) is 56,235 tons, down 780 tons; the downstream inventory (weekly, tons) is 41,616 tons, up 752 tons; other inventory (weekly, tons) is 33,720 tons, down 180 tons; the registered warehouse receipt (daily, tons) is 33,884 tons, up 30 tons [2] Profit Estimation - The cash cost of purchased lithium spodumene concentrate is 65,646 yuan, and the profit is - 5593 yuan; the cash cost of purchased lithium mica concentrate is 65,796 yuan, and the profit is - 7243 yuan [3]

Report Summary 1. Report Industry Investment Rating - Not provided in the report 2. Core Viewpoints - The main contract price of lithium carbonate fell below 60,000 yuan/ton. Fundamentally, weekly supply decreased, demand remained stable, and there were signs of slight destocking. Downstream acceptance of current prices is low, spot trading volume is small, and the price center continues to move down. Short - term futures prices are expected to be weak [3] 3. Summary by Relevant Catalogs Lithium Compounds - SMM battery - grade lithium carbonate average price is 62,000 yuan/ton, down 500 yuan; SMM industrial - grade lithium carbonate average price is 60,400 yuan/ton, down 500 yuan [1] Lithium Ore - Lithium spodumene concentrate (CIF China, Li2O: 5.5% - 6%) is 297, down 2; Lithium mica (Li2O: 1.5% - 2.0%) is 700; Lithium mica (Li2O: 2.0% - 2.5%) is 1,250, down 10; Phosphorus lithium aluminum stone (Li2O: 6% - 7%) is 5,950; Phosphorus lithium aluminum stone (Li2O: 7% - 8%) is 6,950, down 25 [1][2] Positive Electrode Materials - The average price of lithium iron phosphate (power type) is 30,780 yuan/ton, down 120 yuan; The average price of ternary material 811 (polycrystalline/power type) is 145,360 yuan/ton, down 100 yuan; The average price of ternary material 523 (single - crystal/power type) is 115,475 yuan/ton, down 170 yuan; The average price of ternary material 613 (single - crystal/power type) is 122,635 yuan/ton, down 120 yuan [2] Price Spreads - The price spread between battery - grade and industrial - grade lithium carbonate is 1,600 yuan/ton; The price spread between battery - grade lithium carbonate and the main contract is 1,080 yuan/ton, down 1,320 yuan; The price spread between the near - month and the first - continuous contract is - 20 yuan/ton, down 180 yuan; The price spread between the near - month and the second - continuous contract is - 340 yuan/ton, up 520 yuan [2] Inventory - Total inventory (weekly, tons) is 131,779, down 141 tons; Smelter inventory (weekly, tons) is 57,015, up 493 tons; Downstream inventory (weekly, tons) is 40,864, down 564 tons; Other inventory (weekly, tons) is 33,900, down 70 tons; Registered warehouse receipts (daily, tons) is 34,154, down 825 tons [2] Profit Estimation - The cash cost of外购 lithium spodumene concentrate is 66,208 yuan, and the profit is - 5,065 yuan; The cash cost of外购 lithium mica concentrate is 66,952 yuan, and the profit is - 7,321 yuan [3] Industry News - South Africa launched a key mineral development strategy, and the cabinet officially approved the "Key Minerals and Metals Strategy" and solicited public opinions on the "2025 Mineral Resources Development Act (MRDB)" [3]

Core Viewpoint - China's strategic dominance in the rare earth and critical minerals sector is resilient and not easily undermined by export controls or attempts from other countries to diversify supply chains [1][6]. Group 1: China's Dominance in Rare Earths - China accounts for approximately 60% of global production of critical minerals and over 85% of refining capacity [1]. - The country produces 40% of the world's refined copper, 70% of refined cobalt, over 60% of lithium, and 99% of battery-grade graphite [1]. - China controls 87% of the global permanent magnet market, with rare earths being a core component [1]. Group 2: Global Supply Chain Dependencies - The US Geological Survey (USGS) indicates that the US relies entirely on imports for 12 critical minerals and has over 50% import dependence for 29 minerals [2]. - China supplies 72% of the US's annual demand for critical minerals, followed by Malaysia (11%) and Japan (6%) [2]. Group 3: Strategic Investments and Education - China has established and funded multiple national-level rare earth laboratories and specialized courses in universities, leading to a strong educational foundation in mining technology [2]. - The country holds the most mining technology patents globally, showcasing its technological leadership [2]. Group 4: Historical Context and Market Impact - The 2010 export ban on rare earths to Japan resulted in a price surge of over 5 times, highlighting China's significant influence on the supply chain [4]. - Despite global efforts to diversify supply chains post-pandemic, China's economies of scale and resource allocation make alternatives challenging for other nations [4]. Group 5: India's Response and Challenges - India is attempting to reduce its supply chain vulnerabilities through the "National Critical Minerals Mission" (NCMM) and aims to engage the private sector in exploration and mining [5]. - The country seeks to build resilient supply chains through platforms like the "Quad," but complete detachment from China is deemed unrealistic and requires long-term efforts [5]. Group 6: Long-term Strategic Considerations - China's dominance in rare earths is a product of long-term strategic planning, supported by government initiatives, advanced processing technologies, and top-tier educational institutions [5]. - Analysts suggest that while China's position is currently strong, it must remain vigilant and invest in foundational research and talent development to mitigate long-term risks [6].