China July lithium-ion battery materials production

China's nickel sulfate production stood at 194,700 tonnes in July, or 42,800 tonnes in Ni. content, up 6.9% month on month (MoM) according to Mysteel's survey. The production comprised 0% nickel briquette/powder, 52.9% MHP, 38.54% high-grade nickel matte, 6.69% secondary nickel, and 0.42% NPI by raw material.

 

In July, the production of ternary precursor enterprises slightly decreased, but the demand for nickel sulfate from nickel plates rose, leading to an overall increase in nickel sulfate production.

 

Nickel sulfate production in August is expected to reach 43,000 tonnes in Ni. content, up 0.28% month-on-month. Of this, approximately 18,000 tonnes of nickel sulfate will be used to produce nickel plate. At present, the profit margin of nickel sulfate production is meager on firm MHP prices. Coupled with production constraints from some enterprises undergoing technical renovation in August, spot prices are projected to rise marginally. It is expected that the demand for nickel sulfate will also increase during the peak season for downstream ternary precursors.

 

Indonesia's MHP production reached 40,300 tonnes in Ni. content in July, up 4.81% MoM and up 49.60% YoY, according to Mysteel's survey of eight sampled projects in Indonesia.

 

From January to July, the cumulative production of MHP in Indonesia reached 262,600 tonnes in Ni. content, an increase of 59.49% year-on-year. It is expected that Indonesia's MHP production will up 3.17% MoM to 41,600 tonnes in August.

 

Indonesia's nickel matte production reached 25,100 tonnes in Ni. content in July, up 1.51% MoM, according to Mysteel's survey of 15 sampled projects in Indonesia. This includes 15,100 tonnes of high-grade nickel matte and 10,000 tonnes of low-grade nickel matte.

 

From January to July, Indonesia's cumulative nickel matte production totaled 164,500 tonnes in Ni. content, down 16.37% compared to the previous year. In August, Indonesia's nickel matte production is projected at 25,600 tonnes, up 1.89% MoM but down 18.52% YoY.

 

In July, China's cobalt sulfate production stood at 13,096 tonnes, showing a month-on-month decrease of 13.07% and a year-on-year decline of 40.98%.

 

In July, the ternary battery demand remained sluggish with no signs of recovery and electrolytic cobalt inventories persisted at high levels without meaningful drawdown. In addition, electrolytic cobalt smelters implemented additional production reductions due to sustained losses and weak downstream consumption. Thus, multiple cobalt salt smelters suspended the operations, reducing the cobalt sulfate production in July.

 

It is estimated that China's cobalt sulfate production will stand at 13,409 tonnes in August, up 2.39% MoM but down 32.25% YoY. In August, the recovery in ternary battery demand remains uncertain, while electrolytic cobalt inventories stay elevated. Therefore, most cobalt salt plants maintain lower operating rates. However, there are several smelters likely to resume the production in August based on the production scheduling, adding modest supply. Given these factors, the cobalt sulfate production is projected to show a slight month-on-month increase in August.

 

China's cobalt chloride production totaled 16,175 tonnes in July, a decline of 14.16% MoM and a decrease of 29.51% YoY. In July, the downstream demand softened after centralized replenishment. In this case, some smelters slightly reduced the operating rates, while some stopped the production during the month, resulting in a decrease in production in July.

 

It is projected that China's cobalt chloride production will fall 2.53% MoM to 15,766 tonnes in August, with a decline of 33.68% YoY. In August, the demand for Co3O4 may remain stable and cobalt chloride smelters still have some inventory. Meanwhile, electrolytic cobalt producers continue to reduce the production due to high costs and profits compression. In this condition, the overall demand for cobalt chloride may remain flat. Some cobalt salt smelters have experienced production cuts and shutdowns due to the tight supply of raw materials and sustained high prices, resulting in a possible month-on-month decline in cobalt chloride production in August.

 

China's lithium carbonate production totaled 76,600 tonnes in July, rising 3.5% month on month, according to Mysteel.

 

In July, major refineries with their own mines in Jiangxi Province continued to increase the production and maintained high operating rates. The factories that were previously under maintenance in Sichuan gradually resumed the production. And the production in Qinghai remained stable. In terms of the recycling sector, the price of lithium carbonate rose in July, and hydrometallurgical plants gradually resumed the production or increased the recycling of lithium-ion battery waste.

 

In summary, despite planned maintenance of spodumene production lines and sudden suspension by certain smelters, the overall production showed an increasing trend in July.

 

It is expected that China's lithium carbonate production will rise 4.1% MoM at 79,600 tonnes in August. Major producers in Jiangxi continue ramping up production in August. In Sichuan, a Phase II project has been put into operation, and some production lines have gradually resumed the production. Within the recycling sector, leading plants have reported stable orders and their production enthusiasm is relatively high.

 

In July, China's lithium hydroxide production totaled 21,200 tonnes, rising 5.3% month-on-month. Major producers largely maintained stable operations in July. Lithium carbonate prices advanced strongly, lifting lithium hydroxide spot offers rapidly and boosting smelter production enthusiasm. However, limited incremental production from new capacity ramp-ups prompted some facilities to adjust production lines toward lithium carbonate for excess profits, resulting in a marginal increase in overall lithium hydroxide supply.

 

It is likely that China's lithium hydroxide production will fall 2.7% MoM at 20,700 tonnes in August. Ternary precursor demand is projected to see recovery in August though with limited upside. Production orders remain concentrated among top-tier smelters, and other smelters maintain low operating rates for lithium hydroxide as some production lines have shifted to the production of lithium carbonate. It is expected that the overall production of lithium hydroxide will decline in August.

 

China's ternary precursors production stood at 64,500 tonnes in July, representing a month-on-month decline of 0.51% and a year-on-year drop of 8.24%. The traditional off-season in July saw flat market demand with no meaningful growth. The overall industry saw little improvement, and only overseas demand was acceptable besides the CATL supply chain.

 

Looking ahead to August, China's ternary precursors production is estimated to be 69,000 tonnes, showing a 7.03% MoM increase but a 3.77% YoY decrease due to the traditional seasonal high.

 

China's ternary cathode material production reached 59,800 tonnes in July, down 2.24% MoM but up 5.99% YoY. July was in the traditional off-season, with sluggish downstream demand. Except for the CATL supply chain and LG supply chain, the demand declined across the board, leading to a decrease in production.

 

China's ternary cathode material production is likely to rise 9.14% MoM to 65,300 tonnes in August, with an increase 12.08% YoY mainly due to the kick-off of the peak season that stimulus a demand recovery.

 

China's cobalt powder production stood at 757 tonnes in July, moving down 2.57% MoM and 1.88% YoY. In July, the cobalt powder prices were boosted slightly thanks to the bullish impact of the electrolytic cobalt market. However, orders from the downstream traditional hard-alloy industry remained flat. Though the smelters maintained high operating rates, only slight fluctuations were observed in the overall production.

 

It's likely that China's powder production may reach 725 tonnes in August. Specially, the firm prices of cobalt powder in early August could hardly be transmitted to the upstream and downstream sectors. Coupled with the off-season in August, there will be fewer new orders signing, and market players mainly hold a cautious attitude and focus on digesting existing inventory. It is expected that cobalt powder production will slightly decrease in August, with players mainly focusing on fulfilling early orders.

 

In July, China's electrolytic cobalt production stood at 2,110 tonnes, a month-on-month decrease of 18.85% and a year-on-year drop of 52.9%.

 

In July, overseas summer shutdowns, coupled with sluggish domestic demand, led to an accumulation of electrolytic cobalt inventory. Meanwhile, tight supply of cobalt intermediates kept prices high, significantly squeezing the profit margins of electrolytic cobalt. As a result, the smelters continued their production reduction strategy, leading to a decline in electrolytic cobalt supply during this month.

 

China's electrolytic cobalt production is expected to reach around 1,900 tonnes in August. Currently, domestic inventories remain high. While electrolytic cobalt prices are supported by raw material costs, the actual demand has not improved. Spot transactions remain sluggish, and profitability remains under pressure. Therefore, electrolytic cobalt production in August is expected to decline further compared to the previous month.

 

In July, China's Co3O4 production reached 8,530 tonnes, with a month-on-month decline of 15.54% and a year-on-year drop of 6.57%. In July, the Co3O4 producers focused on the fulfillment of long-term and tolling orders. Meanwhile, the smelters' operating rates declined amid the muted demand. In addition, one leading producer slashed its output by 50%. In this condition, the overall Co3O4 production declined in July.

 

It's likely that China's Co3O4 production will rebound 10.55% MoM to 9,430 tonnes in August, with a decline of 1.46% YoY. In August, the cobalt intermediates supply is expected to stay tight and smelters prioritize long-term contract fulfillment. Meanwhile, the smelters moderately increase their operating rates as it is the peak season for 3C products. Therefore, the Co3O4 production may move up slightly in August.

 

China's lithium manganese oxide (LMO) production reached 8,600 tonnes in July, up 0.58% month-on-month. Leading LMO producers maintained steady operations during July, primarily fulfilling the existing orders. Despite rapid industry capacity expansion in recent years, market demand has failed to keep pace, resulting in a limited growth in the supply of LMO.

 

China's LCO production totaled 10,970 tonnes in July, moving up 2.52% compared to last month. In July, the rapid surge in cobalt intermediates prices prompted downstream battery cell manufacturers to stock up. However, new orders for LCO remained subdued, with supply primarily relying on previously signed long-term contracts. Smelters maintained stable production, resulting in minimal month-on-month production fluctuations.

 

It's likely that China's LCO production will reach 11,800 tonnes in August, with a month-on-month increase of 1.91% as August-September is the peak season for 3C electronic products. Meanwhile, battery cell factories will likely gradually build up stocks in advance due to bullish cobalt price outlook driven by the tight supply of raw materials. In this condition, there will be more purchases in August, leading to slightly increase in LCO production.

 

In July, China's iron phosphate production reached 249,800 tonnes, exceeding the expectations with a month-on-month increase of 7.4%. The iron phosphate prices continued to fall due to new production capacity coming on stream and increased market supply, as multiple companies gradually ramped up new capacity, significantly boosting market availability. Integrated LFP manufacturers maintained rising operating rates, while smaller producers continued to operate at full capacity, resulting in relatively stable overall supply.

 

The iron phosphate production in August 2025 is projected to reach 264,000 tonnes, a month-on-month increase of 5.7%. The growth will be primarily driven by leading integrated manufacturers and the release of new capacity.

 

China's LFP production was up 3.69% MoM at 299,100 tonnes in July. Energy storage demand surged in July, driving a month-on-month increase in overall market demand.

 

China's LFP production is projected at 309,200 tonnes in August, up 3.38% MoM. Current strong energy storage order volumes have kept leading enterprises operating at high rates, while some LFP manufacturers continue production ramp-ups.

 

China's anode material production totaled 216,600 tonnes in July, rising 16.7% month-on-month and 41.07% year-on-year. In July, new orders for anode materials were concluded, and manufacturers boosted production to deliver order contracts. Downstream energy storage orders increased, which also drove the demand for anode materials.