Citi Cuts Lithium Forecasts on Worsening Battery Demand Outlook

By Annie Lee November 02, 2026 at 04:03 AM GMT+8

Citigroup Inc. cut its price targets for lithium for the next two years, citing concerns over a slowdown in battery demand growth, rising trade uncertainty and broader macroeconomic headwinds.

Fears of demand deterioration for the metal next year have triggered a “lithium reset,” it said in a note by analysts including Shreyas Madabushi, warning that prices will remain depressed in the near term.

“With supply expected to improve in 2027 and uncertainty around next year’s demand elevated, consumers are likely to defer purchases and maintain lean inventories,” the bank said in the note released Friday. “Sentiment and positioning are likely to remain the dominant drivers in the near term, keeping risks skewed to the downside.”

Citi cut its three-month lithium carbonate and hydroxide price targets to $12,000 a ton from $20,000 and $17,000, respectively, while reducing its spodumene forecast to $1,200 from $2,000. The bank also lowered its estimates for all three battery ingredients through the end of 2028.

The most-active lithium carbonate contract on the Guangzhou Futures Exchange rose 1.2% to 91,160 yuan ($13,710) a ton in the morning session. It’s shed more than 40% since the end of August.

A plan to limit Chinese hybrid-vehicle exports to the European Union and Beijing’s phase-outs of some tax benefits have added to concerns about demand for car batteries and large-scale energy-storage systems in recent weeks. Goldman Sachs Group Inc. forecast last month that the lithium market will shift from a deficit to near balance this quarter, followed by surpluses over the next two years.

The fate of Contemporary Amperex Technology Co. Ltd.’s Jianxiawo mine in China’s Jiangxi province has also been an important driver of lithium prices since it was shut last August. The battery maker received environmental approval on Friday from the local government for the project. CATL’s share price rose as much as 4.2% in Shenzhen on Monday.