How have China's reforms impacted the lithium market?

China's power sector reforms and a pledge to crack down on overcapacity have contributed to stronger lithium demand and a significant price increase from recent lows.

What is the price forecast for lithium in 2026?

Analysts forecast a price range of 80,000-200,000 yuan per ton for lithium in 2026, a notable increase from 2025 prices.

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Lithium Market Rebound: Energy Storage Drives Demand

Q: What is driving the lithium demand surge in 2026?

A significant increase in demand for battery storage, fueled by China's power sector reforms and global data center expansion, is driving the lithium demand surge for 2026.

5 Jan

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Summary

Energy storage demand is set to become a game changer for lithium.
China's power sector reforms spurred stronger-than-expected lithium demand.
Lithium prices surged 130% from recent lows following policy changes.

Lithium Market Rebound: Energy Storage Drives Demand

The lithium market is showing signs of recovery, with demand for battery storage expected to significantly bolster the sector's outlook for 2026. Following a period of oversupply that began in the latter half of 2022, stronger-than-anticipated demand for lithium in power system storage, influenced by China's power sector reforms and global data center growth, has supported a more optimistic view.

China's clean-tech exports, particularly battery storage systems, have seen substantial growth, surpassing electric vehicle exports in value. Analysts forecast a lithium deficit in 2026, contrasting with an expected surplus in 2025. Lithium carbonate prices on the Guangzhou Futures Exchange experienced a significant surge of 130% from their 2025 low, reaching their highest point since November 2023 by December 29, 2025.