Lithium prices tumble 10% after E.U. deal cuts hybrid car exports

Albemarle (ALB) and other lithium stocks traded sharply lower pre-market Monday after lithium carbonate futures prices in China plunged to a nearly 10-month low, as an agreement to limit hybrid car exports to the European Union added to concerns over demand prospects for the battery material.

In pre-market trading, Albemarle (ALB) down 4.2%, SQM (SQM) down 4.2%, Lithium Argentina (LAR) down 3.2%, Sigma Lithium (SGML) down 1.9%, Atlas Lithium (ATLX) down 1.7%, Lithium Aericas (LAC) down 0.8%.

The most active lithium carbonate contract on the Guangzhou Futures Exchange fell to its weakest since December 17, 2025, before settling down 11.8% to 104,740 yuan/ton ($15,649), marking its steepest daily decline since March.

China and the European Union reached an agreement that could cut Chinese exports of hybrid cars to the bloc by more than half, the European Trade Commission said Friday.

Lithium prices have been on a downward trajectory since hitting a 33-month high at 209,880 yuan on May 13 on concerns about demand from electric vehicles and larger-scale energy storage systems.

Lithium's supply-demand balance is shifting in a bearish direction, Goldman Sachs analysts said in a note, forecasting that both the Chinese and global markets will move from a deficit to nearly balanced in Q4 followed by surpluses in the next two years.