Report Industry Investment Rating There is no information provided regarding the report industry investment rating in the given content. Core Viewpoints - Currently, the lithium ore, lithium salt, and cell markets are under significant inventory pressure, and the pattern of medium - to long - term supply - demand imbalance has not been substantially alleviated. There are two short - term logics in the market: a negative feedback cycle of "lithium salt price drop - ore price decline - lithium salt price drop again" and a stepped - up price increase chain of "futures price increase - capacity release - increased ore consumption - ore price increase". The cost reduction also drives the decline of lithium carbonate prices. The futures market in the second half of the year is expected to have two stages: prices will fluctuate upward in early Q3 and decline in Q4 [3][4]. - In the short term, the market is generally strong due to macro - sentiment and supply - side disturbances. In the long - term, as lithium salt prices rise, corporate profits will increase, and the future operating rate is expected to rise [5]. Summary by Directory 1. Weekly Summary 1.1 Market Review - This week, lithium carbonate futures fluctuated and declined. The closing price of the weighted index contract on Friday was 69,250 yuan/ton, with a weekly decline of 12.98%. The trading volume was 857,282 lots, a week - on - week decrease of 49.72%. The open interest was 696,107 lots, a week - on - week decrease of 212,071 lots. The LC2509 - LC2511 contract spread changed to contango structure. The number of warehouse receipts on the GME was 6,605 lots, a week - on - week decrease of 5,391 lots [1]. 1.2 Industry Performance - **Supply**: This week, the price of lithium ore turned down, with an average decline of about 13%. The price decline of the lithium salt market was smaller than that of the ore. The price of lithium carbonate decreased by about 2%, while that of lithium hydroxide increased. The basis quotes of traders remained stable. The weekly operating rate of sample lithium salt factories decreased by 7.86% week - on - week, and the lithium carbonate output decreased by 7.31% week - on - week [1]. - **Demand**: This week, the price decline of downstream material factories was relatively small. The price of lithium iron phosphate series decreased by about 2%, and that of ternary material series increased by about 1%. The price of the electrolyte remained stable. The operating rate of lithium iron phosphate decreased, and the output decreased slightly. The output of ternary materials increased week - on - week, the output of lithium manganate increased slightly, and the output of cobalt - acid lithium enterprises decreased week - on - week [2]. - **Terminal**: The price of the cell market remained stable. This month, the cell output increased month - on - month, while the output of power cells decreased month - on - month [3]. - **Inventory**: This week, the domestic lithium ore inventory decreased week - on - week, the lithium carbonate inventory decreased by 1.01% week - on - week, the lithium iron phosphate inventory increased week - on - week, the ternary material inventory decreased week - on - week, the lithium manganate inventory remained unchanged week - on - week, and the cobalt - acid lithium inventory increased week - on - week [3]. 1.3 Core Logic - There are two short - term logics in the market: a negative feedback cycle of "lithium salt price drop - ore price decline - lithium salt price drop again" and a stepped - up price increase chain of "futures price increase - capacity release - increased ore consumption - ore price increase". The cost reduction also drives the decline of lithium carbonate prices. The futures market in the second half of the year is expected to have two stages: prices will fluctuate upward in early Q3 and decline in Q4 [3][4]. 1.4 Nanhua's Viewpoint - In the short term, the market is generally strong due to macro - sentiment and supply - side disturbances. In the long - term, as lithium salt prices rise, corporate profits will increase, and the future operating rate is expected to rise [5]. 1.5 Bullish Interpretation - As the prices of lithium ore and lithium salt continue to decline, the probability of supply - side disturbances is increasing; the situation of high open interest and low warehouse receipts is being traded in the market; and the production schedule on the demand side has increased more than expected [6]. 1.6 Bearish Interpretation - There are still many future production expectations for lithium ore, and high inventory suppresses ore prices. If ore prices further decline, it will drag down the cost of lithium carbonate; the inventory of lithium ore and lithium salt is high and still in an accumulation trend; and industrial technology upgrades have postponed the elimination of high - cost production capacity [7]. 2. Price and Spread - The prices of lithium ore, lithium salt, downstream materials, and terminal products in the lithium - battery industry chain this week showed different trends. The prices of most lithium ore varieties decreased, the price of lithium carbonate decreased slightly, the price of lithium hydroxide increased, the price of downstream lithium iron phosphate decreased slightly, the price of ternary materials increased slightly, and the price of the electrolyte remained stable [8][9]. 3. Lithium Ore 3.1 Import - There are data on the total monthly import volume of lithium concentrate, the import volume by country, and their seasonal trends, but specific numerical analysis is not provided in the summary [15]. 3.2 Output - There are data on the seasonal output of Chinese sample spodumene mines and lithium mica mines, but specific numerical analysis is not provided in the summary [17]. 3.3 Inventory - There are data on Chinese lithium ore inventory, including total inventory, warehouse inventory, and trader inventory, as well as the seasonal inventory of lithium salt factories, but specific numerical analysis is not provided in the summary [19]. 4. Supply 4.1 Operating Rate - The weekly operating rate of sample lithium carbonate enterprises decreased by 7.86% week - on - week. The operating rate of lithium spodumene enterprises increased by 14.67%, while that of lithium mica enterprises decreased by 37.83%, that of salt - lake enterprises decreased by 28.62%, and that of recycling material enterprises decreased by 4.06% [28]. 4.2 Output - The weekly total output of sample lithium carbonate enterprises decreased by 7.31% week - on - week. The output of lithium carbonate produced from lithium spodumene increased by 14.68%, while that from lithium mica decreased by 36.2%, that from salt - lake materials decreased by 28.63%, and that from recycling materials decreased by 4.1% [36]. 4.3 Import - There are data on the total monthly import volume of lithium carbonate, the import volume by country, and their seasonal trends, but specific numerical analysis is not provided in the summary [37][39]. 4.4 Inventory - The weekly total inventory of lithium carbonate decreased by 1.01% week - on - week. The inventory of smelters decreased by 6.19%, the downstream inventory increased by 7.18%, and other inventories decreased by 2.42% [46]. 4.5 Profit - There are data on the production profit of purchasing lithium ore, the import profit of lithium carbonate, and the theoretical delivery profit, but specific numerical analysis is not provided in the summary [48][51]. 5. Demand 5.1 Operating Rate - There are data on the operating rates of lithium iron phosphate, ternary materials, lithium manganate, cobalt - acid lithium, and electrolyte, but specific numerical analysis is not provided in the summary [53][55]. 5.2 Output - There are data on the weekly output of lithium iron phosphate, ternary materials, lithium manganate, cobalt - acid lithium, and electrolyte, but specific numerical analysis is not provided in the summary [57][60]. 5.3 Inventory - There are data on the total inventory of the lithium iron phosphate, ternary materials, lithium manganate, and cobalt - acid lithium industries, but specific numerical analysis is not provided in the summary [62][64]. 5.4 Profit - There are data on the profits of lithium iron phosphate, ternary materials, lithium manganate, and cobalt - acid lithium, as well as the theoretical cost of lithium iron phosphate electrolyte, but specific numerical analysis is not provided in the summary [66][67]. 6. Terminal Cells 6.1 Output - There are data on the output of SMM lithium batteries by type, the output of power cells by type, and the output of energy - storage cells, but specific numerical analysis is not provided in the summary [69]. 6.2 Installation Volume - There are data on the seasonal installation volumes of Chinese lithium batteries, LFP batteries, and NCM batteries, but specific numerical analysis is not provided in the summary [72][73]. 6.3 Cell Inventory - There are data on Chinese lithium battery inventory by type, the seasonal inventory of power cells by type, but specific numerical analysis is not provided in the summary [75][77].