FX.co ★ Lithium Rises to 19-Month High

Lithium carbonate futures in China have surged, surpassing the CNY 110,000 per tonne threshold for the first time in 19 months, driven by reduced supply against a backdrop of anticipated stronger demand. The Bureau of Natural Resources in Yichun, home to a key lithium mining center in Jiangxi province, announced plans to revoke 27 mining permits early next year. This decision aligns with the prior suspension of operations in CATL's Jianxiawo lithium mine, as the Chinese government seeks to curb capacity across various industries to avoid the detrimental effects of a "race-to-the-bottom" scenario exacerbating deflationary pressures. Concurrently, the production of new energy vehicles in China witnessed a 20.6% increase, reaching a record 1.823 million units in November. Furthermore, Beijing has announced intentions to double its electric vehicle charging capacity to 180 gigawatts by 2027. This initiative aims to bolster lithium-dependent energy storage systems and includes compensation mechanisms for power storage infrastructure development.