China's lithium hydroxide production fell to 22,600 tonnes in August, marking a 3.4% decrease month-on-month, according to a survey by Mysteel. This decline is attributed to several producers adjusting their production expectations downward and upgrades to flexible production lines at certain smelters during the month. Additionally, there has been limited demand for spot market orders, with long-term contracts continuing to dominate the market.

Looking ahead, production is projected to drop further by 4.8% in September, with an expected output of 21,700 tonnes. While some new production lines are set to launch, a portion will be dedicated to lithium carbonate production, and current operating rates at lithium hydroxide smelters may not reach full capacity. This ongoing trend reflects the challenges faced by the lithium market amid fluctuating demand and production adjustments.