Tianqi Lithium's Xia Juncheng: Lithium battery growth is clear over the next decade; recommends establishing a diversified pricing system

Ask AI · Can a diversified pricing system smooth out the risk of lithium price volatility?

China Jing News reporter Li Zhe, Beijing report

“Over the next ten years, the growth trend in lithium demand is clear. New energy vehicles remain the core driving force, and emerging sectors such as the low-altitude economy, humanoid robots, and energy storage are becoming new growth engines for lithium demand.” Xia Juncheng, Board Chair and President of Tianqi Lithium (002466.SZ, 09696.HK), said at the 2026 Battery Raw Materials Conference.

(Tianqi Lithium Board Chair and President Xia Juncheng, Li Zhe/photo)

The reporter of China Business News noted that, as downstream demand continues to be released, the price of battery-grade lithium carbonate entered an upward cycle in the second half of 2025. As of March 24, 2026, the average price of battery-grade lithium carbonate was 147,500 yuan/ton, while the average price of industrial-grade lithium carbonate was 144,500 yuan/ton.

When asked how to build a healthy lithium salt pricing system, Xia Juncheng suggested: “We should build a diversified pricing system, introduce multidimensional quotation institutions, and comprehensively consider futures prices and trading conditions to break information barriers and form a more general market pricing benchmark. At the same time, we should reshape the logic of allocation across the industrial chain, smooth out irrational price spreads, and steer the industry back onto a healthy, sustainable development track.”

Demand over the next decade is on an uptrend

A research report released by the China Post Securities Research Institute shows that global shipments of solid-state batteries are expected to rise to 771.36 GWh by 2030, with a compound annual growth rate (CAGR) of over 260% from 2023 to 2030. New energy vehicles and energy storage will remain the main demand scenarios for solid-state batteries in the future. In addition, the low-altitude economy, humanoid robots, and consumer batteries will also maintain high compound growth rates over the next five years.

“Over the next ten years, lithium demand will be on a clearly defined upward channel. Growth is a foregone conclusion, and the compound growth rate supports long-term buoyancy.” Xia Juncheng said. This growth relies mainly on new energy vehicles, but emerging sectors such as the low-altitude economy, humanoid robots, and energy storage are becoming new growth points. Judging from the data, regardless of any differences between demand and supply, the overall period from 2026 to 2035 will show an upward trend.

Specifically, the low-altitude economy covers three core segments: aircraft manufacturing, operational flights, and support services. Xia Juncheng explained that by 2030, even just the annual electricity consumption of the eVTOL fleet alone will reach the GWh level, driving battery installation demand in the million kWh range. Based on the estimate that about 0.85 kg of lithium carbonate equivalent (LCE) is needed per kWh of batteries, the low-altitude sector will add lithium demand in the range of hundreds of tons to thousands of tons over the next 5–10 years.

From the market perspective, the growth certainty for lithium battery demand in the energy storage sector is relatively high. Research from GGII (GaoGong Lithium Industry, formerly known as GGII) shows that the global AIDC (artificial intelligence data center) energy storage market is entering a phase of rapid volume expansion. By 2030, shipments of energy storage batteries for AIDC are expected to exceed 300 GWh, which is 20 times the projected shipments volume in 2025 (15 GWh).

Xia Juncheng said that, based on a neutral scenario (600 tons of lithium carbonate consumed per 1 GWh of energy storage batteries), the increase in shipments of AIDC energy storage batteries will directly translate into rapid growth in lithium carbonate demand.

As one of the current technology routes for lithium battery development, the commercialization of solid-state batteries is also drawing market attention. As the commercialization of solid-state batteries accelerates, it will drive upstream lithium resource market demand.

“From 2027 to 2030 will be the key window period for large-scale GWh-level capacity construction in the all-solid-state lithium battery industry.” Xia Juncheng mentioned that, based on data from multiple institutions and industry-group calculations, in the future solid-state batteries will maintain rapid compound growth across three dimensions: demand volume, shipment volume, and market size. Among these, the growth rate of market size is especially prominent—by 2030, the compound annual growth rate is expected to reach 48.4%.

Build a diversified pricing system

Given a long-term positive outlook on market demand, capital markets are closely watching price fluctuations resulting from changes in supply and demand. Meanwhile, new challenges are also posed to the supply side of the lithium battery industrial chain.

“From the current supply landscape of the lithium carbonate market, long-term contracts are the ballast.” Xia Juncheng said that although the proportion of long-term contracts in 2025 decreased back to 60%–80%, considering supply-chain security, long-term contracts will remain the mainstream. Institutional quotations, thanks to their stability, occupy the leading position in pricing. Trading between lithium salt producers and cathode material producers, as well as cell manufacturers, is mainly based on long-term contracts.

Beyond long-term contracts, the futures market has become one of the important tools for stabilizing price fluctuations of lithium carbonate.

Xia Juncheng said, “In China’s lithium carbonate futures and spot markets, trading is active. In 2025, the average成交量 of the futures benchmark contract was 450,000 tons per day. Domestic monthly demand for lithium carbonate exceeds 120,000 tons, and the scale advantage is significant. Leveraging high liquidity advantages, global lithium ore (including Australian ores and African ores) pricing is anchored to lithium carbonate prices, which has an important impact on prices of global lithium products.”

Currently, there is structural divergence in the lithium carbonate pricing mechanism. Downstream cell manufacturers pursue stability in institutional quotations, while upstream players (especially in the lithium ore segment) seek higher premiums through futures. Xia Juncheng analyzed that if the pricing mechanisms differ between purchasing and sales, there may be a risk of price spread. In spot transactions, traders use futures-spot trading tools to help smooth out the risk of upside-down pricing between upstream and downstream, making them an indispensable “adjuster” in the supply chain. However, during periods of severe price volatility, traders’ cost of capital also squeezes their profit margins.

In Xia Juncheng’s view, there are still a series of bottlenecks in current lithium salt pricing. “Institutional quotations are systematically lower than futures (with an extreme deviation of 17%), which leads to delayed price transmission and prevents a full reflection of the market’s true expectations. In addition, the midstream processing link faces a structural mismatch between ‘costs linked to futures (high)’ and ‘sales anchored to institutional quotes (low),’ which becomes the main stage where profits across the industrial chain are squeezed.” Xia Juncheng said.

To this end, Xia Juncheng suggested that we should build a diversified pricing system, introduce multidimensional quotation institutions, comprehensively consider futures prices and trading conditions, break information barriers, and form a more generally applicable market pricing benchmark. We should reshape the logic of allocation within the industrial chain, smooth out irrational price spreads, and push the industry back onto a healthy, sustainable development track.

When discussing how to promote healthy development of the industrial chain, Xia Juncheng believes that companies across the chain should work together to continuously improve the lithium industry pricing mechanism, and also explore a more diversified, more balanced, and healthier pricing system. At the same time, the technical value and ESG value of products should be appropriately reflected in price setting, achieving a closed-loop system of high-quality and favorable pricing, and jointly promoting long-term, orderly, healthy, and stable high-quality development in the lithium industry.

Tianqi Lithium said that as a new energy material company centered on lithium, the company will rely on research and development innovation, continuously promote high-value utilization of lithium resources and breakthroughs in frontier technologies such as materials supporting solid-state batteries, and actively take the lead in participating in the formulation of international and domestic standards for the lithium industry, using technology to help drive standardized industrial development.

(Editor: Dong Shuguang; Reviewer: Wu Kezhong; Proofreader: Zhang Guogang)