(Yicai) Nov. 21 -- The price of lithium carbonate futures listed on the Guangzhou Futures Exchange slumped to the lowest since their debut in July, and prices are unlikely to pick up soon due to a downturn in the new energy vehicle market and an oversupply of the key raw material used in electric car batteries, a Chinese securities company said.

The main lithium carbonate futures contract LC2401 at the Guangzhou Futures Exchange sank 4.6 percent to CNY132,300 (USD18,536) per tonne today, the lowest closing price since July 21. And the spot price of battery-grade lithium carbonate sank by CNY1,500 (USD210) to CNY147,500 per tonne to a two-year low.

As the end of the peak consumption season approaches, the new energy vehicle industry will enter an off-season which might last for some time, futures brokerage Everbright Futures said in a research report.

The price of battery-grade lithium carbonate has tumbled over 70 percent this year due to a slowdown in the country’s electric car market and as more lithium production capacity comes online.

The lithium carbonate spot market is inactive as the procurement of lithium ore and lithium salts is sluggish, Everbright Futures said.

The main contract LC2401 will expire in January 2024, and as the delivery date approaches, the concentration of short positions are significantly higher than that of long positions, which may exacerbate market volatility, according to a report by Orient Securities.

In the first 10 months, China’s installed battery capacity surged 31.5 percent from a year earlier to 294.9 GWh, paling in comparison to last year’s year-on-year growth rate of 90.7 percent, according to data from the China Automotive Battery Innovation Alliance.

Editor: Kim Taylor