Analysis of Lithium Carbonate Price Rebound and Lithium Mining Stock Investment Strategy

1. Price Elasticity Continues
   : Since the low of about 58,000 yuan/ton in June 2025, the lithium carbonate main contract has continuously hit 120,000-130,000 yuan in intraday trading at the end of December, with a cumulative increase of over 100%. The market widely believes this is the resonance result of the “dual-drive” of supply contraction and demand restart [1].
2. Supply-side Contraction Continues
   : Domestic main producing areas (such as Yichun, Jiangxi) continue to carry out mining license cleanup and production resumption approval, thereby exacerbating structural shortages; the suspension and resumption information of CATL’s Yichun Jianxiawo Lithium Mine has been repeatedly interpreted, forming uncertainty about short-term supply and price support [2]. At the same time, overseas (Australia, Indonesia) manufacturers are also cutting production or adjusting targets, strengthening the “production reduction” expectation [1][2].
3. Demand-side Changes
   : Power batteries remain the main engine, but energy storage, data centers, and industrial applications are growing faster. Many institutions predict that global lithium carbonate demand will approach over 2 million metric tons by 2026, and the growth rate of energy storage demand is expected to exceed that of traditional automobiles. The market even expects a shift to supply shortage from 2026 to 2027 [2][5]. In addition, global concerns about critical mineral security have prompted lithium companies to lock in major customers and long-term contracts, forming a “supply guarantee” logic [1][5].

1. Cost and Financial Quality Differentiation
   :
   • Tianqi Lithium (002466) and Ganfeng Lithium (002460) have price guidance, but they are still in a state of “high debt and profit volatility” currently, with ROE and net profit margin remaining negative, reflecting that profit recovery has not been fully achieved [0].
   • Salt Lake Industry Co., Ltd. (000792) can achieve high gross profit and cash flow through the salt lake route and potassium fertilizer business output, with an ROE of about 15.6% and net profit margin of 38.1%, showing stable finances and periodic hedging capabilities [0].
   • From the perspective of market capitalization and valuation: Salt Lake Industry Co., Ltd. has the largest market capitalization and rational valuation (PE 25x), while Tianqi and Ganfeng have negative PE due to losses, and their market capitalization is highly sensitive to price expectations [0].
2. Capacity and Expansion Rhythm
   :
   • Tianqi Lithium is promoting the expansion of mines such as Greenbushes, targeting to release lithium concentrate supply, but profit recovery constraints still take time [5].
   • Ganfeng focuses on integration (lithium salt, batteries, recycling) and has high debt ratio; the profit leverage brought by price breakthroughs can only be truly released after cost stabilization [5].
   • Salt Lake Industry Co., Ltd. focuses on both rapid lithium salt capacity construction and potassium fertilizer, giving it more flexibility in the price rise cycle [5].
3. Valuation Reshaping and Risks
   : Lithium carbonate prices have approached the “new cycle” level. The industry is alert that once supply recovers (such as CATL’s production resumption, gradual policy relaxation), prices may correct, putting pressure on loss-making enterprises again. In addition, futures speculation risks (such as the Qingshan Nickel Short Squeeze) remind the base metal sector to pay attention to price volatility and position control [2].

1. Phased Layout
   : At this stage, it is recommended to prefer Salt Lake Industry Co., Ltd., which has stable fundamentals, significant cost advantages, and strong cash flow, as the preferred choice for “resisting corrections” in the cycle recovery, and focus on its sales expansion and potassium fertilizer synergy; for Tianqi and Ganfeng, a “band + event-driven” strategy can be adopted, closely tracking prices, capacity commissioning, and asset impairment risks.
2. Prevent Supply Reversal Risks
   : Closely monitor the production resumption progress of CATL’s Yichun Jianxiawo Lithium Mine and whether the policy level promotes orderly capacity release (such as mining license restoration, EIA approval); once the production resumption pace accelerates, it may lead to short-term supply release in the industry, suppressing prices and affecting high-expectation stocks.

Figure 1 shows the normalized stock price changes, market capitalization, key financial indicators, and YTD growth of Tianqi Lithium, Ganfeng Lithium, and Salt Lake Industry Co., Ltd. in 2025. It can be intuitively seen that although the three have similar annual growth rates, the differences in financial health (ROE, net profit margin) are huge, suggesting that investment decisions need to balance “growth expectations” and “profit quality” [0].

Lithium carbonate prices rebounded from 58,000 yuan/ton to 120,000 yuan/ton, establishing a pattern of “high volatility + supply-demand restructuring”. Under the interweaving of supply-side production cuts and uncertainty about CATL’s production resumption, the investment logic for lithium mining stocks has shifted from “balanced bullish” to “quality protection + event-driven”. It is recommended to take Salt Lake Industry Co., Ltd. as the core defensive position, while maintaining flexible and phased allocation to high-leverage variables such as Tianqi and Ganfeng, and continuously observe price corrections, capacity return, and policy rhythm to avoid passive layout in volatility.

[0] Jinling API Data (including company overview, technical analysis, historical prices, charts, etc.)
[1] East Money · Lithium Carbonate Price Breaks 130,000 and Supply Contraction Analysis (https://caifuhao.eastmoney.com/news/20251227083958969486500)
[2] The Paper · “Carbon Discussion | Lithium Carbonate Futures Surge Over 100% in Half a Year, Industry Pattern Welcomes Three Engines” (https://www.bjnews.com.cn/detail/1766734007129896.html)
[3] Kitco News · “Lithium gains momentum in 2025” (https://www.kitco.com/opinion/2025-12-03/lithium-gains-momentum-2025)
[5] 21st Century Business Herald · “Double! Is the Super Lithium Cycle Coming Again?” (https://www.21jingji.com/article/20251225/herald/9472291cce468aa5f7108d69b6d7e5cc.html)