Group 1: Report Overview - Report Name: Carbonate Lithium Futures Daily Report [1] - Date: July 22, 2025 [2] - Researcher: Zhang Ping, Yu Feifei, Peng Jinglin [3] Group 2: Market Review and Operational Suggestions - Market Performance: Carbonate lithium futures rose, driven by expectations of a new round of supply-side reform. Total positions increased by 17,000 to 678,000, while total trading volume decreased, indicating reduced trading enthusiasm. Spot prices followed the upward trend, with electric carbon rising by 1,350 to 68,000. Although downstream material manufacturers' acceptance of current price levels remains low, their purchasing willingness has marginally improved due to the continuous upward market trend and inventory digestion. Some enterprises' rigid purchasing needs are supporting the market price, pushing up the central price of carbonate lithium spot transactions [11]. - Import Data: In June 2025, China imported 576,000 tons of spodumene, a 4.8% decrease from the previous month. The import volume of ore remains at a relatively high level, and the fundamentals are still weak. The entire carbonate lithium industry chain faces serious problems of overcapacity and price competition [11]. - Market Outlook: The expected inflection point of carbonate lithium futures has preceded the fundamentals. It is expected that the futures price will rise, but the upward trend may be tortuous due to the drag of spot prices [11]. Group 3: Industry News - Spodumene Import: In June 2025, the total import volume of spodumene was approximately 576,000 tons, a 4.8% decrease from the previous month, equivalent to 46,000 tons of LCE. Lithium ore from Australia, Zimbabwe, and South Africa accounted for 79%. The import volume from Australia was about 256,000 tons, a 31% decrease from the previous month; from Zimbabwe, it was about 101,000 tons, a 3% increase; from South Africa, it was 98,000 tons, an 87% increase. Additionally, the import volume from Nigeria was about 79,000 tons, a 21% increase [14]. - Lithium Hydroxide Trade: In June 2025, China exported 6,260 tons of lithium hydroxide, a 12% increase from the previous month but a 56% decrease from the same period last year. Exports to South Korea and Japan accounted for 96% of the total export volume. The export volume to South Korea was 5,130 tons, a 51% increase from May but a 51% decrease from the same period last year; to Japan, it was 876 tons, a 50% decrease from May and a 74% decrease from the same period last year. In June, China imported 1,482 tons of lithium hydroxide, a significant 76% increase from the previous month [14].

Core Viewpoint - The lithium carbonate market is experiencing a temporary price increase, but the fundamental oversupply situation remains unchanged, indicating potential for future price declines [1][7]. Supply and Production - Lithium carbonate production capacity in China reached a new high, with total production capacity at 134,438 tons in May, a year-on-year increase of 45.68% [2]. - Battery-grade lithium carbonate production was 6,230 tons in May, up 29% year-on-year, while industrial-grade production was 20,507 tons, down 9% [2]. - Despite the increase in production capacity, the overall supply growth rate for both battery-grade and industrial-grade lithium carbonate has shown significant slowdown [2]. Cost Dynamics - The prices of raw materials such as spodumene and lithium mica are declining, with spodumene priced at $629 per ton and lithium mica at 720 yuan per ton as of June 27 [3]. - The average production cost for companies using spodumene is approximately 69,600 yuan per ton, while those using lithium mica have a cost of about 56,300 yuan per ton [3]. - Current production costs for lithium carbonate are expected to decrease, but the support for prices from these costs is weakening [3]. Demand Trends - The growth rate of the new energy vehicle (NEV) market is expected to slow down, with NEV sales reaching 1.27 million units in May, a year-on-year increase of 35% [5]. - The market share of NEVs has increased significantly, but the growth rate is stabilizing around 40%, indicating potential for further declines in growth [5]. - The photovoltaic industry has also seen a slowdown in growth due to policy changes, which may impact the overall consumption of lithium carbonate [6]. Inventory Levels - As of May 30, lithium carbonate inventory stood at 97,637 tons, with smelter inventory at 55,391 tons and downstream inventory at 42,246 tons, reflecting a high level of inventory for the year [7]. - The current inventory levels suggest a continuation of the bearish fundamental outlook for lithium carbonate [7].

Summary of Key Points from Conference Call Records Industry Overview - **Lithium and Rare Earth Industry**: The conference call primarily discusses the lithium and rare earth sectors, focusing on supply dynamics, pricing trends, and government regulations affecting these industries [1][3][6]. Core Insights and Arguments - **Supply Tightening in Lithium**: The verification report for lithium reserves in Yichun, Jiangxi Province, may lead to some companies being unable to renew mining licenses on time, potentially affecting lithium carbonate production by approximately 20,000 tons per month, which could drive prices up [1][4]. - **Impact of Qinghai Salt Lake Production**: Companies in Qinghai are less affected by the recent regulatory changes, but there are concerns about overproduction and illegal mining practices that could pose risks to lithium supply [1][5]. - **Government Regulation Intent**: The government aims to optimize the lithium industry by eliminating loss-making capacities and better understanding national strategic metal reserves, which has contributed to a rebound in lithium prices from low levels [1][6]. - **Rare Earth Supply-Demand Shift**: Initially, there was an oversupply of rare earths in May, but a shift to a supply deficit is expected in Q3, which is likely to significantly boost prices, with prices for products like gadolinium oxide nearing 500,000 yuan per ton [1][9]. - **Geopolitical Factors Enhancing Rare Earth Value**: The U.S.-China trade tensions have led to a reassessment of the strategic value of rare earths, with China limiting exports and the U.S. supporting local industries, thus enhancing the valuation of the rare earth sector [1][10]. - **Market Sentiment in Rare Earths**: The auction of gadolinium and niobium metals on the Baotou exchange has led to a price increase, reflecting heightened market activity and confidence, with bullish sentiment prevailing [1][12]. Additional Important Content - **Current Lithium Companies to Watch**: Companies such as Zhongmin Resources, Shengxing Lithium Energy, Tianqi Lithium, Ganfeng Lithium, and Yongxing Materials are highlighted for their stable stock performance and future growth potential [1][7]. - **Rare Earth Market Trends**: The rare earth market has shown significant improvement, with a tightening supply situation compared to the previous year, leading to a positive price outlook [1][9][13]. - **Investment Opportunities in Rare Earths**: The rare earth magnetic materials sector is recommended for investment, with companies like Northern Rare Earth and China Rare Earth being noted for their potential [1][15][17]. - **Precious Metals Market Outlook**: The precious metals market, particularly silver and gold, is viewed optimistically due to expectations of Federal Reserve interest rate cuts, with silver showing strong performance due to its dual financial and industrial attributes [2][16][18]. This summary encapsulates the key points discussed in the conference call, providing insights into the lithium and rare earth industries, market dynamics, and investment opportunities.

Report Industry Investment Rating - Not mentioned in the provided content Core Viewpoints - The lithium ore, lithium salt, and battery cell markets are under significant inventory pressure, and the de - stocking process is slow. The long - term supply - demand imbalance has not been substantially alleviated [3]. - There are two short - term logics in the market: a negative feedback loop of "lithium salt price drop - ore price decline - lithium salt price drop again" and a step - by - step upward chain of "futures price increase - production capacity release - increased ore consumption - ore price increase" [3]. - The futures market in the second half of the year is expected to be divided into two phases: the futures price will fluctuate upward in early Q3 due to improved macro - sentiment, supply disruptions, and the "off - season not so off" phenomenon; in Q4, the futures price is expected to decline as technological upgrades are completed and production volume is concentratedly released [3]. - There are both positive and negative factors affecting the market. Positive factors include improved macro - sentiment, supply - side disruptions, and the market trading of the contradiction between high open interest and low warrant numbers. Negative factors include high future lithium ore production expectations, continuous inventory accumulation, and industrial technology upgrades [3][5]. Summary by Directory Futures Data - **Futures Price and Volume**: The closing price of the lithium carbonate futures main contract was 71,280 yuan/ton, with a daily increase of 1,320 yuan (1.89%) and a weekly increase of 4,800 yuan (7.22%). The trading volume was 848,150 lots, a daily decrease of 358,173 lots (- 29.69%) and a weekly decrease of 166,408 lots (- 16.40%). The open interest was 381,185 lots, a daily increase of 3,880 lots (1.03%) and a weekly increase of 25,024 lots (7.03%) [8]. - **Futures Spread**: The LC08 - 11 spread was 1,060 yuan/ton, a daily decrease of 200 yuan (- 15.87%) and a weekly increase of 340 yuan (47.22%); the LC09 - 11 spread was 1,080 yuan/ton, a daily decrease of 260 yuan (- 19%) and a weekly increase of 600 yuan (125%); the LC11 - 12 spread was 60 yuan/ton, a daily decrease of 60 yuan (- 50%) and a weekly decrease of 460 yuan (- 115%) [10]. Spot Data - **Lithium Ore Price**: The average price of lithium mica (Li2O: 2 - 2.5%) was 1,545 yuan/ton, with a daily increase of 40 yuan (2.66%) and a weekly increase of 95 yuan (6.55%); the average price of lithium spodumene (Li2O: 6%, Brazilian CIF) was 755 US dollars/ton, with a daily increase of 25 US dollars (3.42%) and a weekly increase of 65 US dollars (9.42%) [15]. - **Lithium Salt Price**: The average price of industrial - grade lithium carbonate was 66,350 yuan/ton, with a daily increase of 1,300 yuan (2.00%) and a weekly increase of 3,300 yuan (5.23%); the average price of battery - grade lithium carbonate was 68,000 yuan/ton, with a daily increase of 1,350 yuan (2.03%) and a weekly increase of 3,350 yuan (5.18%) [18]. - **Downstream Product Price**: The average price of lithium iron phosphate (power type) was 32,075 yuan/ton, with a daily increase of 320 yuan (1.01%) [22]. Basis and Warrant Data - **Basis**: The basis of the main continuous contract of lithium carbonate and brand - based basis quotes of different companies are provided, with most showing no daily change [26]. - **Warrant Quantity**: The total warrant quantity decreased from 10,239 to 9,969, a decrease of 270. Some warehouses had a reduction in warrant quantity, such as Wugang Wuxi and Jiangsu Benniu Port [31]. Cost and Profit - **Production and Import Profit**: The production profit of lithium carbonate from purchased lithium spodumene concentrate (Li₂O: 6%) and lithium mica concentrate (Li₂O: 2.5%), as well as theoretical delivery profit and import profit trends are presented, but specific profit values are not summarized here [29].

Group 1 - The market experienced fluctuations with a total trading volume of 1.57 trillion yuan, an increase of 31.7 billion yuan compared to the previous trading day, with mixed performance among individual stocks [1] - Key sectors showing gains included rare earth permanent magnets, lithium mining, non-ferrous metals, and coal, while gaming, photovoltaics, CPO, and consumer electronics sectors faced declines [1] - CITIC Securities highlighted continuous catalysts in the AI computing power sector, with companies like Meta investing billions in data centers and OpenAI launching a general AI agent in ChatGPT [1] Group 2 - The announcement of the construction of the Yarlung Tsangpo River downstream hydropower super project is seen as a positive development for the hydropower sector [2] - The civil explosives industry is expected to see a significant increase in concentration, with production value projected to grow from 27.3 billion yuan in 2015 to 41.7 billion yuan in 2024, averaging a 5% annual growth [2] - The domestic market indices, driven by heavyweight stocks, returned to the 3,500-point mark, with the Shenzhen and ChiNext indices nearing previous highs, indicating potential short-term technical adjustments [2]

Market Overview - The market experienced fluctuations with the Shanghai Composite Index reaching a new high for the year, while the ChiNext Index also hit a yearly peak before retreating [1] - The total trading volume in the Shanghai and Shenzhen markets was 1.57 trillion yuan, an increase of 31.7 billion yuan compared to the previous trading day [1] - The number of stocks that rose and fell was roughly equal, with sectors such as rare earth permanent magnets, lithium mining, non-ferrous metals, and coal showing significant gains [1] Company Announcements - Xiling Information announced that its controlling shareholder is planning a change in control, leading to a temporary suspension of its stock for up to two trading days [2] - Kanghua Bio disclosed that its controlling shareholder intends to transfer 28.47 million shares, representing 21.91% of the total share capital, to Shanghai Wankexin Biotechnology, with a total transaction value of approximately 1.85 billion yuan [3] - Qidi Design, in a consortium with other companies, has been pre-awarded a project for the Henan Airport Intelligent Computing Center, with a bid amount of 860 million yuan, which is expected to positively impact the company's performance [4] New Stock Subscription - A new stock, Hanguo Group, is available for subscription with an issue price of 15.43 yuan, and the subscription date is set for July 21, 2025 [6] External Market - The Nasdaq Composite Index slightly increased by 0.05%, continuing to set new closing highs, while Netflix shares fell over 5% [8] - Over the past week, the S&P 500 Index rose by 0.59%, the Nasdaq gained 1.51%, and the Dow Jones experienced a slight decline of 0.07% [8]

Core Viewpoint - The recent surge in the A-share market, particularly in rare earth, lithium, and small metal sectors, is driven by policy signals aimed at reducing excess capacity and improving market prices, referred to as the "anti-involution" concept [6][16][17]. Group 1: Market Performance - On July 18, major stocks in the rare earth and lithium sectors saw significant gains, with North Rare Earth rising by 9.87% and Jiuwu High-Tech soaring by 20% [1]. - The Wind popular concept index showed substantial increases in various sectors, with rare earths up by 6.09% and lithium mining by 3.04% [2]. - In the futures market, aluminum oxide prices surged nearly 7%, while glass and soda ash also saw increases exceeding 5% [7][9]. Group 2: Policy Impact - Recent announcements regarding lithium resource mining permits have led to speculation about potential nationwide restrictions, contributing to price increases in lithium futures [10][11]. - The "anti-involution" policy aims to address overcapacity and low-price competition across multiple industries, including traditional sectors like steel and new sectors like photovoltaics and lithium batteries [16][17]. - The Ministry of Industry and Information Technology has indicated that a new round of growth stabilization plans for key industries will be implemented, signaling a systematic approach to the "anti-involution" strategy [17]. Group 3: Industry Trends - The photovoltaic industry is experiencing a strong upward trend, with polysilicon futures prices rising over 50% since late June [3][14]. - Glass manufacturers are reducing production by 30% to manage supply, which is expected to impact the market positively [12]. - The industrial product futures index has increased by 4.18% in July, with coal, building materials, and steel sectors showing significant gains [14]. Group 4: Future Outlook - Analysts are optimistic about the "anti-involution" trend, suggesting that industries with high inventory and low capacity utilization may benefit from upcoming policy measures [18]. - Historical precedents indicate that supply-side reforms can lead to significant improvements in industry profitability, as seen in the steel and coal sectors during previous reforms [18]. - The upcoming political bureau meeting may further enhance growth stabilization policies, potentially leading to a more sustained recovery in the industrial product market [18].

Group 1: Market Overview - The A-share market showed a positive trend with major indices rising, particularly the Shanghai Composite Index reaching a new closing high for the year [2] - Resource cyclical stocks were prominent, with the rare earth permanent magnet sector experiencing significant gains, alongside lithium and coal sectors [2][3] - The overall market is transitioning from a "weight-driven" to a "theme-driven" approach, indicating a structural market trend [8] Group 2: Rare Earth Sector - The rare earth permanent magnet sector saw active trading, with several stocks hitting the daily limit up, including Jiuwu High-Tech and Huahong Technology [3] - The discovery of a new mineral, "Nedun River Mineral," by a research team from China University of Geosciences, highlights the complexity and resource diversity of the Baiyun Obo mine, the world's largest rare earth deposit [3] - As of July 18, 17 companies in the rare earth permanent magnet sector have released half-year performance forecasts, with 9 expecting profit increases and 5 turning losses into profits [4] Group 3: Lithium Sector - The lithium mining sector experienced significant movements, with stocks like Shengxin Lithium Energy and Jinyuan Co. hitting the daily limit up [6] - A recent announcement from Cangge Mining regarding the suspension of lithium resource development due to compliance issues has raised concerns about supply constraints in the lithium market [6] - Major lithium companies Tianqi Lithium and Ganfeng Lithium reported improved performance forecasts, indicating a potential recovery in the sector [7] Group 4: Investment Outlook - Financial institutions suggest that the market is likely to continue focusing on structural opportunities, particularly in technology growth sectors supported by policy and industrial upgrades [8] - The trend indicates a shift from capital-driven to profit-driven industry operations, with expectations of dual recovery in performance and valuation across various sectors [8]

Investment Rating - The report maintains a standard rating for the non-ferrous metals industry [2] Core Views - The non-ferrous metals industry has shown a mixed performance, with the small metals sector rising by 6.58% and the industrial metals sector declining by 3.49% in the past two weeks [3][12] - The rare earth and magnetic materials sector is experiencing a significant profit increase, driven by improved supply-demand dynamics and price recovery [5][65] - Lithium prices continue to decline due to oversupply, but leading companies are expected to recover as high-cost production is phased out [66] Industry Performance Overview - As of July 17, 2025, the non-ferrous metals industry has decreased by 0.87% over the past two weeks, underperforming the CSI 300 index by 2.55 percentage points [12] - Year-to-date, the industry has increased by 20.08%, outperforming the CSI 300 index by 17.55 percentage points, ranking first among 31 industries [12] - The small metals sector has shown a year-to-date increase of 24.87%, while the industrial metals sector has increased by 16.89% [18] Price Trends - As of July 17, 2025, LME copper is priced at $9,678 per ton, LME aluminum at $2,589 per ton, and LME nickel at $15,065 per ton [24] - The rare earth price index has risen to 192.03, with significant increases in prices for praseodymium-neodymium oxide and dysprosium oxide [42][65] - Lithium carbonate prices are stabilizing, with battery-grade lithium carbonate at 64,800 yuan per ton [40][66] Company Performance Highlights - Northern Rare Earth expects a net profit increase of 1,882.54% to 2,014.71% for the first half of 2025 [56] - Ningbo Yunsheng anticipates a net profit increase of 133.55% to 250.33% for the same period [57] - Xiamen Tungsten's revenue for the first half of 2025 is projected at 19.178 billion yuan, with a net profit of 972 million yuan, a decrease of 4.41% year-on-year [52][67]

Core Viewpoint - The lithium extraction from salt lakes concept has seen a significant increase, with a rise of 3.30% in the market, leading the sector in gains [1][2]. Group 1: Market Performance - The salt lake lithium concept led the market with a 3.30% increase, while other sectors like animal vaccines and avian influenza saw declines of -0.96% and -0.90% respectively [2]. - Within the salt lake lithium sector, 37 stocks rose, with notable performers including Fumiao Technology and Jiuwu High-Tech reaching the daily limit of 20% [1][2]. - The top gainers in the sector included Shengxin Lithium Energy, Guojin General, and Jinyuan Co., with increases of 10.00%, 9.95%, and 9.98% respectively [3][4]. Group 2: Capital Inflows - The salt lake lithium concept attracted a net inflow of 1.259 billion yuan, with 26 stocks receiving capital inflows, and 6 stocks exceeding 100 million yuan in net inflow [2][3]. - Shengxin Lithium Energy topped the net inflow list with 327 million yuan, followed by Jiuwu High-Tech and Tianqi Lithium with 145 million yuan and 139 million yuan respectively [2][3]. - The net inflow ratios for leading stocks included Jinyuan Co. at 45.14%, Shengxin Lithium Energy at 35.30%, and Fumiao Technology at 19.00% [3][4].