Futures Daily: MMLC Lithium Carbonate Spot Index Enables Deep Integration of Futures and Spot Markets
2026-03-18 14:41:20
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"China is the world's core supply and consumption market for lithium carbonate, with more than 80% of smelting capacity and material output concentrated here. This industrial structure determines that we need a price benchmark that is both authoritative and practical, and that is tailored to local conditions."
"Lithium carbonate serves as the pricing anchor for the lithium battery industry chain. Its price fluctuations directly impact lithium ore, lithium hydroxide, cathode materials, and even power batteries, affecting the operational decisions of the entire industry chain," said Lu Qing. He added that the pricing model in the lithium battery industry has been undergoing profound changes in recent years. Before 2023, long-term contracts accounted for as much as 90% of transactions, with pricing primarily relying on quotes from single websites. Most contracts locked in volume but not price, instead using dynamic pricing formulas or conditional agreements. However, with the listing of lithium carbonate futures, the pricing structure in the distribution market has become more diversified. According to Lu Qing, from 2023 to 2025, the proportion of long-term contracts for lithium carbonate across the industry will decrease from 90% to 70%-80%; during this period, the long-term contract discount rate will increase from 92% to 99% of the website price, and the QP mechanism will transition from M to M+1.
She believes that in 2026, the proportion of long-term contract sales of lithium carbonate is expected to continue to decline, while the discount rate will continue to increase.
"This transformation not only meets the needs of industrial development, but also places higher demands on the professionalism, timeliness, and fairness of price indices." According to Lu Qing, the MMLC lithium carbonate spot price index was jointly developed and launched by Shanghai Steel Union and China Minmetals in 2023 against this backdrop.
"We have built a sample system covering the entire industry chain, with manufacturers, traders, and downstream consumers accounting for 25%, 50%, and 25% respectively. Among the data submitters, trading companies account for 88%, ensuring the representativeness of prices," said Lu Qing. He added that the index not only includes the absolute prices of high-quality battery-grade, battery-grade, and industrial-grade lithium carbonate, but also introduces brand premiums and discounts and product premiums and discounts, covering 11 mainstream brands such as Tianqi Lithium and Ganfeng Lithium, which can objectively reflect the market price differences of products of different qualities and brands.
"Timeliness is the lifeline of a price index," said Lu Qing. The MMLC lithium carbonate spot price index operates on a "two-reports-a-day" mechanism: at 10:20 AM, it releases market prices from 4:31 PM of the previous trading day to 10:15 AM of the current day; and at 4:30 PM, it releases the complete transaction data for the day, ensuring companies can promptly grasp market dynamics. More importantly, the index has established a rigorous data quality control system, using the 95% confidence interval method to eliminate outliers and requiring all data to come from actual transactions or available quotes from non-related parties, thus guaranteeing the index's objectivity.
With the increasing integration of futures and spot markets, the correlation between the MMLC lithium carbonate spot price index and the futures market has attracted significant attention. According to Lu Qing, in 2025, the correlation coefficient between the MMLC lithium carbonate spot price index and the Guangzhou Futures Exchange's lithium carbonate futures price reached 99.5%. Currently, the lithium carbonate spot price index is widely used across various segments of the lithium battery industry chain, from pricing based on "lithium carbonate price minus processing fees" in lithium ore trading to pricing based on "consumption coefficient + processing fees" for lithium hydroxide and lithium iron phosphate materials, becoming an important reference for industry pricing.
Lu Qing stated that in the future, Shanghai Steel Union will continue to optimize the lithium carbonate spot price index system, expand the sample coverage, and include more emerging brands and regional market data. At the same time, it will deepen the integration of futures and spot applications, promote the index to play a greater role in financial instruments such as futures hedging and over-the-counter options, and build a communication bridge between the spot and futures markets through professional price index services. This will help industrial enterprises improve their risk management capabilities and inject stable momentum into the high-quality development of the lithium battery industry.
"China is the world's core supply and consumption market for lithium carbonate, with more than 80% of smelting capacity and material output concentrated here. This industrial structure determines that we need a price benchmark that is both authoritative and practical, and that is tailored to local conditions."
"Lithium carbonate serves as the pricing anchor for the lithium battery industry chain. Its price fluctuations directly impact lithium ore, lithium hydroxide, cathode materials, and even power batteries, affecting the operational decisions of the entire industry chain," said Lu Qing. He added that the pricing model in the lithium battery industry has been undergoing profound changes in recent years. Before 2023, long-term contracts accounted for as much as 90% of transactions, with pricing primarily relying on quotes from single websites. Most contracts locked in volume but not price, instead using dynamic pricing formulas or conditional agreements. However, with the listing of lithium carbonate futures, the pricing structure in the distribution market has become more diversified. According to Lu Qing, from 2023 to 2025, the proportion of long-term contracts for lithium carbonate across the industry will decrease from 90% to 70%-80%; during this period, the long-term contract discount rate will increase from 92% to 99% of the website price, and the QP mechanism will transition from M to M+1.
She believes that in 2026, the proportion of long-term contract sales of lithium carbonate is expected to continue to decline, while the discount rate will continue to increase.
"This transformation not only meets the needs of industrial development, but also places higher demands on the professionalism, timeliness, and fairness of price indices." According to Lu Qing, the MMLC lithium carbonate spot price index was jointly developed and launched by Shanghai Steel Union and China Minmetals in 2023 against this backdrop.
"We have built a sample system covering the entire industry chain, with manufacturers, traders, and downstream consumers accounting for 25%, 50%, and 25% respectively. Among the data submitters, trading companies account for 88%, ensuring the representativeness of prices," said Lu Qing. He added that the index not only includes the absolute prices of high-quality battery-grade, battery-grade, and industrial-grade lithium carbonate, but also introduces brand premiums and discounts and product premiums and discounts, covering 11 mainstream brands such as Tianqi Lithium and Ganfeng Lithium, which can objectively reflect the market price differences of products of different qualities and brands.
"Timeliness is the lifeline of a price index," said Lu Qing. The MMLC lithium carbonate spot price index operates on a "two-reports-a-day" mechanism: at 10:20 AM, it releases market prices from 4:31 PM of the previous trading day to 10:15 AM of the current day; and at 4:30 PM, it releases the complete transaction data for the day, ensuring companies can promptly grasp market dynamics. More importantly, the index has established a rigorous data quality control system, using the 95% confidence interval method to eliminate outliers and requiring all data to come from actual transactions or available quotes from non-related parties, thus guaranteeing the index's objectivity.
With the increasing integration of futures and spot markets, the correlation between the MMLC lithium carbonate spot price index and the futures market has attracted significant attention. According to Lu Qing, in 2025, the correlation coefficient between the MMLC lithium carbonate spot price index and the Guangzhou Futures Exchange's lithium carbonate futures price reached 99.5%. Currently, the lithium carbonate spot price index is widely used across various segments of the lithium battery industry chain, from pricing based on "lithium carbonate price minus processing fees" in lithium ore trading to pricing based on "consumption coefficient + processing fees" for lithium hydroxide and lithium iron phosphate materials, becoming an important reference for industry pricing.
Lu Qing stated that in the future, Shanghai Steel Union will continue to optimize the lithium carbonate spot price index system, expand the sample coverage, and include more emerging brands and regional market data. At the same time, it will deepen the integration of futures and spot applications, promote the index to play a greater role in financial instruments such as futures hedging and over-the-counter options, and build a communication bridge between the spot and futures markets through professional price index services. This will help industrial enterprises improve their risk management capabilities and inject stable momentum into the high-quality development of the lithium battery industry.
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