- Several LFP manufacturers in China have raised prices or plan to do so as rising demand leads to supply constraints.
- Benefiting from growing demand for EVs and energy storage, the effective capacity utilization rate of LFP producers has now risen above 95 percent.
Chinese lithium producers have increased prices or intend to do so as demand growth causes supply tightening, according to a local media report.
Several major lithium iron phosphate (LFP) manufacturers have recently proposed price increases, with one company stating in its recent price adjustment plan that it would raise the processing fee for its entire LFP product line by RMB 3,000 ($420) per ton starting January 1, 2026, according to a report today by Shanghai Securities News.
The price adjustment plan cited in the report noted that product pricing would be renegotiated should significant market or raw material price fluctuations occur.
Another major LFP manufacturer recently implemented a price hike, increasing processing fees for its LFP products by RMB 3,000 per ton effective November 1, 2025, the report noted.
Orders signed and effective before November 1, 2025, will remain subject to the original contract prices.
The report did not name the two companies. LFP is a key raw material for batteries used in electric vehicles (EVs) and energy storage equipment.
This is primarily due to rising LFP material costs and recent supply constraints, the report said.
Benefiting from growing demand for EVs and energy storage systems, LFP producers' effective capacity utilization has now surpassed 95 percent, with some leading companies operating at full capacity, the report noted.
These price hike proposals represent reasonable demands for LFP producers, but the final outcome still depends on negotiations, the report quoted an industry insider as saying.
LFP is the primary cathode material for lithium batteries. On December 1, spot prices for LFP materials used in power batteries stood at RMB 39,950 per ton in China, while those for energy storage applications were quoted at RMB 36,950 per ton, the report noted.
($1 = RMB 7.0753)
