Prices for lithium carbonate equivalent (LCE) are expected to remain low in 2025 due to high inventories and Chinese overcapacity, according to market participants. Many firms have suspended or reduced production at costs above Argus-assessed prices. Factors such as redundant Chinese lithium refining capacity, inventories of low and mid-grade concentrate, and end-of-life LFP batteries have also impacted prices.
Chinese lepidolite, African low-grade ores, and Brazilian tailings are affected by low prices, according to supply chain consultancy SC Insights. Current prices are significantly below the highs of $80,000 per ton seen in late 2022.
A southern Africa-based producer mentioned that their lithium plant in Zimbabwe is on hold due to tight margins. The market may start to recover in the second half of 2026 as carmakers increasingly adopt lower-cost lithium iron phosphate (LFP) batteries.
Between 2025 and 2026, major carmakers are expected to announce plans to use more LFP and lithium iron manganese phosphate (LFMP) batteries. SC Insights forecasts global annual LCE production to exceed 2.5 million tons by 2030, driven by the adoption of newer battery chemistries. The buildout of this supply will depend on China’s proposed restrictions on CAM/LIB technology.
Argentinian lithium production could play a key role in 2025, following Rio Tinto’s announcement to acquire Arcadium Lithium. Argentina holds the third-largest lithium reserves and the second-largest pool of resources globally, according to the US Geological Survey.
