New York, Feb 5, 2026, 07:23 EST — Premarket
- China’s lithium carbonate benchmark dropped roughly 5% from the previous day, while futures hit their lower limit for a short period
- U.S.-listed lithium shares showed a mixed picture in premarket trading, with SQM taking a steep dive
- Investors are balancing short-term demand weakness with a cautiously optimistic long-term view from certain banks
China’s benchmark lithium carbonate prices plunged on Thursday, with the SMM battery-grade index sliding 5.4% to 141,706 yuan per metric ton from Wednesday. The most-traded lithium carbonate futures contract hit its daily limit down — the maximum allowed drop in one session — before bouncing back. Spot sellers stayed cautious, while buyers took advantage of the dips, SMM reported.
The drop is significant since lithium carbonate is essential for lithium-ion batteries, and price shifts in China usually influence contract negotiations and earnings forecasts throughout the supply chain. For miners and processors, just a few volatile sessions can quickly shift margin outlooks.
Timing is critical. China moves toward a Lunar New Year slowdown on Feb. 17, a period when factories and logistics usually scale back and purchasing becomes sporadic.
Albemarle slipped 1.2% to $168.66 in U.S. premarket trading. Chile’s SQM tumbled roughly 7%, landing at $73.78. Lithium Americas dropped 6.6%, whereas Sigma Lithium edged up 2.4%.
Sector headlines keep coming. China’s Tianqi Lithium plans to raise about HK$5.86 billion ($750 million) through a share placement and convertible bonds, according to a filing. The company also aims to offload a small stake in SQM to boost liquidity. Tianqi intends to sell up to 3.6 million SQM class A shares—roughly 1.25% of the total—within the next year. The placing is scheduled to close on Feb. 11, followed by a 90-day lock-up period.
Supply remains a key factor. Zimbabwe reported an 11% rise in 2025 spodumene concentrate exports, but revenue held steady as weak global lithium prices offset the higher volumes. According to the report, prices dipped to $610 a ton in mid-2025 before climbing back above $2,000 in early 2026. The government intends to ban raw concentrate exports starting in 2027 to encourage local processing.
Brazil’s mining regulator reported that Sigma Lithium’s waste piles at the Grota do Cirilo mine show no “imminent risk” following a site inspection. This assessment could bolster Sigma’s effort to challenge a separate closure order issued by the Labor Ministry. The agency stated, “ANM technicians did not identify any geotechnical anomalies,” while Sigma maintains the shutdown hasn’t disrupted its production timetable. Reuters
Some forecasters remain optimistic, but with reservations. UBS has upped its lithium price forecasts by 74%, projecting global lithium demand to grow 14% in 2026 and 16% in 2027, according to research highlighted by Proactive Investors. UBS analyst Lachlan Shaw noted that EVs are “now close to achieving so-called triple parity” — in cost, range, and charging time — which he believes will “accelerate EV growth sales” later this decade. Proactiveinvestors UK
Policy risk returned to the spotlight Wednesday when U.S. Vice President JD Vance unveiled plans for a trade bloc focused on critical minerals. According to Reuters, the proposal includes “reference prices” that would set a tariff floor adjustable by members. This move targets China’s dominance over supply chains for minerals essential to electric vehicles and other sectors. Officials say artificially low prices have skewed the market. Reuters
The downside is clear. Commodity markets broadly sold off Thursday as investors retreated from hard assets and the dollar gained strength. This combo often tightens speculative flows and liquidity, driving smaller markets into abrupt, mechanical swings. “Sentiment (has) turned soggy across most asset classes,” said OCBC strategist Christopher Wong. Reuters
Investors are focusing on one thing now: whether Chinese lithium futures can hold steady after hitting their limit and if spot buying remains strong as the holiday slowdown approaches. In the U.S., Albemarle plans to report its fourth-quarter 2025 earnings after the NYSE closes on Feb. 11. The company will host a conference call the next day, Feb. 12, at 8 a.m. EST.
