Argus Media Limited

10/20/2021 | News release | Distributed by Public on 10/20/2021 06:24

Power curbs lower China's September LCO output

China's lithium cobalt oxide (LCO) output declined to 6,400t in September, down by 5.2pc from August as a result the country's energy consumption control measures, particularly in central China's Hunan and east China's Jiangsu provinces, according to data collated by Argus.

Domestic LCO output rose significantly in the first half of this year on robust demand from the smartphone and computer industries but demand softened in the second half from a shortage of semiconductors, prompting LCO producers to reduce output. The Chinese government has intensified its restrictions on energy consumption since August, with LCO producers forced to cut production to comply with the policy.

January-September production reached 66,500t for LCO, up by 20pc from a year earlier. Xiamen Tungsten New Energy, Hunan Shanshan, Tianjin B&M and Guoan Mengguli are the country's top four LCO manufacturers, accounting for 80pc of China's total production.

China's phone shipments fell to 24.306mn in August, down by 9.7pc from a year earlier, while 5G phone shipments rose to 17.688mn, up by 9.4pc year on year, accounting for 72.8pc of China's total mobile phone shipments. Total phone shipments reached 227mn during January-August, up by 12.3pc year-on-year, with 5G phone shipments of 168mn rising by 79.7pc over the same period, accounting for 74.1pc of China's domestic market, according to data from the China Academy of Information and Communications Technology.

China is the largest LCO production hub in the world, with output of nearly 79,000t in 2020, up by around 35pc from a year earlier and accounting for 75pc of global total production.

Domestic LCO demand has weakened since June and has yet to recover during September-October like in past few years, with market participants expecting the slowdown to continue in November and December.

LCO output in China