Core Viewpoint - The lithium carbonate futures prices have experienced significant fluctuations, with a recent drop exceeding 4%, following a peak above 90,000 yuan/ton, indicating a volatile market influenced by supply and demand uncertainties [1][2][3]. Group 1: Price Movements - Lithium carbonate prices surged due to rumors of mine shutdowns, reaching over 80,000 yuan/ton by August 11, and further climbing to over 90,000 yuan/ton by August 18 [2]. - Following the peak, prices began to decline sharply, with the main contract hitting the limit down on August 20 and falling below 80,000 yuan/ton by August 22 [1][2]. Group 2: Supply and Demand Dynamics - The market's supply dynamics have shifted as companies like Jiangxi Special Electric Motor Co. resumed production, and overseas operations, such as Albemarle's La Negra plant, have also restarted, increasing supply amid high prices [2]. - Analysts predict that the current supply reduction is temporary, with expectations of oversupply in the lithium market over the next two years, potentially exerting downward pressure on prices by 2026 [3]. Group 3: Market Predictions and Strategies - Analysts suggest that the lithium futures market will experience two phases in the second half of the year: a potential price increase in Q3 due to improved macro sentiment and a decline in Q4 as production ramps up [3]. - It is recommended to utilize options to hedge against market volatility, given the high uncertainty in news and market conditions [4].