Heading into Q4 2026, the global lithium battery market remains on a strong growth track. Surging energy storage demand, rising material prices, and accelerating market restructuring are the three signals buyers should watch most closely. Here is an update on the latest industry trends.

1. Energy Storage Enters the TWh Era — A Role Re-Definition

According to a recent survey by CLS (Cailianshe) covering leading players including CATL, Sunwoda, and Shanshan, energy storage battery shipments are entering a new TWh (terawatt-hour) phase. Energy storage has evolved from a supporting component of renewables into a core infrastructure of the power system, with the industry’s evaluation focus shifting from factory specifications to lifecycle returns of power stations. This means customers will demand higher standards in battery quality, cycle life, and long-term field-proven data.

2. Overseas Demand Surges — Orders and Shipments Soar

Data from CNESA shows that contracted overseas energy storage orders grew 83% year-on-year in H1 2026. Chinese companies shipped 380 GWh of utility-scale LFP storage cells globally in the first half, with full-year shipments expected to reach 850 GWh. At CIBF2026, multiple battery makers reported full-capacity production, with overseas inquiries mainly coming from Japan, South Korea, Europe, and Southeast Asia — and customers now care more about delivery lead times than price.

3. Volume and Prices Rise Together — Cells and Cathode Materials Rally

Price signals are equally clear. Mainstream 314Ah LFP energy storage cells have rebounded from RMB 0.26–0.31/Wh in late 2025 to RMB 0.36–0.39/Wh, with some top manufacturers quoting above RMB 0.4/Wh. The average monthly price of LFP cathode material (storage grade) jumped from roughly RMB 31,700/ton in May 2025 to RMB 64,300/ton in May 2026 — an increase of over 100%. Upstream costs such as lithium carbonate and phosphoric acid are also rising, with price increases passing down the supply chain.

4. Strong Earnings — The Industry Enters a Rational Expansion Cycle

The Q3 earnings season confirms the recovery: according to TTIR, 99 listed lithium battery companies generated combined revenue of RMB 611.7 billion in Q3 2026, up about 54.5% year-on-year, with net profit of RMB 44.5 billion, up about 25%. Meanwhile, low-end homogeneous capacity continues to be eliminated, while high-quality capacity backed by technology, integrated supply chains, and order visibility is in short supply. The industry has entered a phase of rational capacity expansion governed by quality, orders, and long-term validation.

5. Technology Trends — High-Density LFP and Solid-State Batteries

Technology upgrades are reshaping competition. High-density LFP materials for storage and fast-charging applications face high technical barriers and difficult mass production, and are expected to remain in short supply through 2028. Demand for all-solid-state battery equipment is shifting from pilot lines to mass production, and CATL has indicated that all-solid-state batteries may enter small-scale production next year.

Closing: Three Sourcing Recommendations

1. Lock in capacity early: With strong overseas demand and extended lead times, place orders early and confirm delivery schedules with your supplier to avoid delays during peak seasons.
2. Watch price pass-through: Raw material and cell prices remain on an upward trend; long-term cooperation and framework agreements help hedge price volatility.
3. Prioritize proven quality: In the TWh era, choosing a supplier with real operating data and full-lifecycle warranty capability matters more than price alone.

As a supplier focused on the battery and energy storage industry, EABK is committed to providing professional product selection and stable supply for LFP batteries, AGV batteries, home energy storage systems, and more.

Over the past two weeks, the lithium battery industry has shown a clear divergence: lithium carbonate prices have dropped toward year lows again, while downstream energy storage demand keeps surging — top manufacturers are running at full capacity and accelerating global expansion. Here is the latest snapshot.

1. Lithium carbonate slips again to new lows

In mid-October, battery-grade lithium carbonate spot prices fell below RMB 110,000/t, quoted at RMB 108,850/t; futures followed, with the main contract closing at RMB 96,540/t on October 28 after touching an intraday low of RMB 96,040/t — nearly halved from its May high. Goldman Sachs expects China’s average spot price to ease further to around RMB 100,000/t in 2027 and RMB 84,000/t in 2028. For buyers, easing upstream costs leave room for more competitive pricing next year.

2. Storage demand keeps booming; top capacity fully booked

EVE Energy shipped 67.52 GWh of storage batteries in the first nine months of 2026, up 39.5% year on year, with Q4 capacity fully booked, and China’s monthly storage battery output hit a new record in October. CATL chairman Robin Zeng said at the World Energy Storage Conference that storage is evolving from a supporting facility for renewables into indispensable new infrastructure for the power grid. The new Five-Year Plan for the battery industry covers storage, AI data centers and robotics, and the “capacity value” of storage has been formally recognized by policy. Industry profitability is recovering too: 19 A-share lithium battery companies reported combined Q3 revenue of RMB 620.37 billion and net profit of RMB 75.05 billion. Separately, a proposed cut to the export tax rebate for new energy vehicles has drawn market attention.

3. Global giants accelerate storage expansion

• CATL launched its 9MWh TENER+ BESS globally at All-Energy Australia and signed MoUs with multiple Australian partners;
• LG Energy Solution signed an MoU with Energix to expand its ESS business in Europe and North America, targeting around 4.5 GWh over the next 24 months;
• Samsung SDI signed a 1 GWh supply agreement for US-made NCA storage cells (Michigan) and has begun converting part of its Indiana plant to LFP cells for energy storage.

4. Price signals: cell quotes diverge, system prices stabilize

On listed prices, CATL’s 314Ah storage cell starts at RMB 0.403/Wh and its 587Ah cell at RMB 0.415/Wh. Mainstream 314Ah cell quotes have recovered from RMB 0.26–0.31/Wh at end-2025 to around RMB 0.36–0.39/Wh. On the system side, Huadian’s 100MW/200MWh high-voltage cascade LFP storage procurement was bid at roughly RMB 0.54–0.569/Wh, with average system bids back above RMB 0.50/Wh.

5. What this means for international buyers

With raw material prices easing but system prices firm, quality cells and systems remain in tight supply, and leading manufacturers prioritize long-term order clients. Buyers planning procurement should lock in quality capacity and delivery slots early, while watching for a potential price drop next year as lithium carbonate softens — long-term supply agreements are an effective hedge against price volatility.

As we enter Q4 2026, the global lithium battery industry stands at a fascinating crossroads — surging energy storage demand on one side, a sharp lithium carbonate price correction on the other, and solid-state battery commercialization officially entering the countdown phase.

1. Energy Storage: From “Supporting Role” to “New Infrastructure”

If power batteries have long been the industry’s traditional main engine, energy storage has emerged as 2026’s biggest surprise.

According to China’s MIIT, H1 2026 energy storage battery output exceeded 420GWh, up a staggering 110% year-on-year. In September alone, domestic storage battery sales reached 73.5GWh — a 104.4% YoY surge — accounting for nearly one-third of total battery sales. CATL’s Q3 earnings showed its storage business growing close to 60% YoY, cementing its position as the company’s new core growth driver.

Policy support is intensifying as well. At the 2026 World Energy Storage Conference, MIIT officials pledged to “resolutely prevent cutthroat competition” and steer the industry from scale expansion toward innovation-led growth. Energy storage has officially been elevated from a “supporting facility” for renewables to “new infrastructure” for the power grid.

2. Lithium Carbonate Price Plunge: A Supply-Chain Reshuffling Window

In stark contrast to the storage boom, lithium carbonate prices have experienced a dramatic correction.

As of mid-October, battery-grade lithium carbonate futures have fallen to approximately RMB 96,000/tonne — a drop of over 54% from the May peak of around RMB 210,000/tonne. On October 12 alone, the price plunged 11.79%, breaking below the RMB 110,000 threshold for the first time this year.

Notably, this decline is largely driven by “expectation trading” — the market is pricing in anticipated supply easing from late Q4 into early next year. In reality, October battery production schedules hit a year-high across the board, and industry inventory at end-September was down roughly 44% from its peak. The fundamentals haven’t deteriorated to match the price drop.

For buyers, this presents a window to lock in quality capacity and negotiate long-term contracts. However, a clear divergence has emerged: premium long-cycle storage cells are tightening while low-end products face oversupply. Leading manufacturers run at 85%–92% utilization, while smaller producers hover at just 45%–60%. The “quality premium” is replacing the “price war” as the industry’s new normal.

3. Solid-State Batteries: 2027, The Year of Mass Production Begins

In 2026, “solid-state battery” appears front and center at virtually every industry expo.

China’s seven-ministry 15th Five-Year Plan for the New Battery Industry sets a clear target: by 2030, all-solid-state batteries will achieve initial scaled application, with long-life lithium batteries reaching 15,000 cycles.

Industry progress is equally rapid:

• CATL has completed a 1GWh all-solid-state pilot line, targeting small-batch production in 2027;
• BYD plans to launch all-solid-state demo vehicles around 2027;
• Samsung SDI and Ecopro BM have signed an agreement targeting sulfide-based all-solid-state commercialization by 2027;
• EVE Energy’s “Longquan No. 3 2.0” all-solid-state cell has rolled off the line, delivering 1,045 Wh/L volumetric energy density.

The industry consensus is taking shape: 2026 is the year of semi-solid commercialization, 2027 is the year of all-solid demo deployment, and full-scale mass production is expected around 2030.

4. Three Takeaways for Overseas Buyers

1. Source storage early — The global storage market is projected to grow over 40% in 2026, with strong demand across Europe, the Middle East, and Australia. Lead times at top manufacturers are extending.
2. Focus on LFP long-cycle products — LFP now accounts for 85.5% of China’s power battery installations. Mainstream storage cells like the 314Ah are on an upward price trajectory; locking in price and volume now helps control costs.
3. Stay rational about solid-state hype — Solid-state remains in the demonstration phase for now. Today’s mainstream LFP lithium batteries still offer the best balance of energy density, safety, and cost-effectiveness.

After three years of price wars, the lithium battery industry has hit a clear turning point in 2026 — raw material prices are recovering, energy storage demand is surging, and leading manufacturers are racing to expand capacity. Here is the latest snapshot, and what it means for New Zealand buyers.

1. Lithium carbonate: rebound, then a “weak balance”

Battery-grade lithium carbonate rebounded from a historic low of around RMB 75,000/t in late 2024, briefly exceeding RMB 150,000/t in the first half of 2026, then eased to about RMB 134,000/t in late September. October remains soft, with supply and demand in a “weak equilibrium.”

2. LFP materials and cells: clear structural divergence

Power-grade LFP is trading at RMB 52,000–55,000/t and storage-grade at RMB 51,500–53,000/t. High-compaction power grades and long-cycle storage grades stay tight and command premiums, while low-end grades face pressure. Utilization diverges sharply: leading integrated plants run at 85%–92%, smaller producers at only 45%–60%.

Storage cells have risen the most: mainstream 314Ah LFP cells moved from RMB 0.26–0.31/Wh at the end of 2025 to RMB 0.36–0.39/Wh, with some quotes above RMB 0.40/Wh, and average storage system bids are back above RMB 0.50/Wh. Leaders such as Hunan Yuneng raised processing fees by RMB 2,000/t from August and announced RMB 24 billion in new capacity — “quality over price” is now the industry norm.

3. Demand: storage is the biggest growth driver

China’s storage lithium battery shipments exceeded 210 GWh in Q1 2026, up over 120% year-on-year, with orders booked through year-end; October production reached 212.5 GWh, a new monthly record (+3.8% MoM). On policy, Document No. 114 established the “capacity value” of storage, and seven ministries issued the 15th Five-Year Plan for the New Battery Industry, covering storage, AI data centers and robotics. Overseas, demand is booming across Europe, the US (AI data centers), the Middle East and Australia, with the global storage market expected to grow more than 40% in 2026.

4. LFP’s global position keeps strengthening

Samsung SDI is converting part of its Indiana plant in the US to produce LFP cells for energy storage, with mass production starting in October 2026, and plans LFP batteries (BBU) for AI servers by 2027. POSCO Future M has also signed a long-term LFP cathode supply deal with Samsung SDI worth around US$4.5 billion.

5. What this means for New Zealand

New Zealand currently has three grid-scale BESS projects (Ruakākā and Glenbrook-Ohurua at 100MW/200MWh each, and Rotohiko at 35MW/35MWh). In late September, the Electricity Authority amended market rules to remove barriers to batteries in the wholesale market, opening up more grid and C&I storage opportunities. LFP remains the mainstream choice for home and off-grid storage thanks to its long cycle life and high safety. For buyers, the key takeaway is simple: premium grades are tight while low-end supply is oversupplied — reliable quality and on-time delivery matter more than the lowest price.

In short, the industry is shifting from a “price war” to a “quality war.” Brands with strong technology, cost control and dependable delivery will benefit most from this long upcycle.

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The lithium battery industry is at a turning point in 2026: energy storage demand is exploding, lithium iron phosphate (LFP) has become the undisputed mainstream chemistry, and cell prices have ended a three-year downturn and entered a new upward cycle. Meanwhile, industry consolidation and new compliance rules are accelerating. For overseas buyers and distributors, understanding these shifts means seizing the right timing — and cost advantages — in procurement.

1. Energy Storage: The New Growth Engine

According to the China Automotive Battery Innovation Alliance, domestic sales of power and storage batteries totaled 783.4 GWh in the first five months of 2026, up 48.5% year on year — with storage batteries growing 87.7%, far outpacing power batteries at 34.9%. Customs data shows China’s lithium battery exports exceeded USD 67.5 billion in the first eight months of this year, up nearly 40%. Industry forecasters expect global storage battery shipments to grow over 60% in 2026, potentially surpassing 1 TWh for the full year. Storage has become the strongest engine driving the entire lithium battery industry.

2. LFP: From Budget Option to Industry Standard

LFP has evolved from a “low-cost route” into the mainstream choice. LFP cells now account for more than 81% of power battery installations, and close to 100% of the storage market. Its three core advantages — safety (thermal runaway threshold up to 800°C), cost efficiency, and long cycle life — make it the preferred chemistry for energy storage and mainstream vehicles alike. At the same time, high-end products such as high-compaction-density LFP remain in tight supply, and competition is shifting from scale expansion to technology leadership.

3. Cell Prices on the Rise: A New Pricing Cycle

After three years of price declines, storage cell prices have rebounded significantly since 2026. Take the mainstream 314Ah LFP storage cell as an example: prices have climbed from around USD 0.043/Wh (RMB 0.31/Wh) at the end of 2025 to RMB 0.37–0.40/Wh — an increase of roughly 25%–35%. Lithium carbonate prices have bounced back from cycle lows, and LFP cathode material prices are up over 80% year on year. Rising raw material costs combined with robust demand have pushed the entire supply chain into an upswing — for buyers, this often means the earlier you lock in orders, the better your cost position.

4. Policy & Compliance: Two Dates to Watch

First, on September 28, China’s Ministry of Industry and Information Technology and six other ministries jointly released the 15th Five-Year Plan for New Battery Industries, targeting initial large-scale application of all-solid-state batteries by 2030 and a cycle life of 15,000 cycles for long-life lithium batteries — a clear signal of the technology roadmap ahead. Second, the EU Digital Battery Passport enters mandatory enforcement on February 18, 2027: all EV and light-vehicle batteries placed on the EU market must comply with carbon footprint, recycled content, and traceability requirements. Buyers serving European markets should evaluate their supply chain’s compliance readiness now.

5. What This Means for Overseas Buyers

Looking ahead to 2026–2027, the lithium battery market will feature high demand growth alongside rising costs. Order visibility from storage projects is strong, but cell and system prices still face upward pressure; LFP has become the de facto standard for storage and mainstream applications; and compliance thresholds in markets like the EU are rising. We recommend buyers plan annual orders in advance, watch price windows closely, and build long-term partnerships with suppliers that offer stable capacity and full compliance — the most effective hedge against price volatility and supply chain risk.

September has brought major shifts across the lithium battery industry, driven by surging demand, rebounding prices, and new policy moves. While global energy storage demand grows at record pace and leading players sign large-scale contracts, cell prices have ended two years of decline, a consumption tax has taken effect, and capacity-overhang warnings have emerged. The industry is clearly moving from “volume competition” toward value-based competition.

Energy storage is the growth engine

Energy storage has become the fastest-growing segment of the battery market. According to SNE Research, global shipments of lithium-ion storage batteries reached 461.3 GWh in H1 2026, up 71% year-on-year, while EV battery installations grew 20.0% to 608.5 GWh. In China, combined sales of power and storage batteries totaled 979.4 GWh in the first half of 2026, up 48.6%, with storage battery sales surging 83.4%. Market surveys expect China’s September battery production to exceed 330 GWh, up about 9% month-on-month, with storage cells accounting for roughly 130 GWh (nearly 40%), driven mainly by year-end grid-connection pushes at overseas projects in the Middle East, Europe, and the US.

Prices bottom out, consumption tax lands

After two years of decline, storage cell prices are climbing back. The average price of 314Ah LFP storage cells has rebounded to around RMB 0.365/Wh in September, up over 20% from the low at the end of 2025; CATL’s 587Ah large-format cell was also publicly listed for the first time at RMB 0.415/Wh. Meanwhile, lithium carbonate prices—which had rebounded sharply from below RMB 60,000/ton in mid-2025—pulled back in September, with the main futures contract briefly dropping to around RMB 128,000/ton on September 11 and spot prices at roughly RMB 142,300/ton, down over 35% from the May peak. On the policy front, a 2% consumption tax on lithium-ion batteries took effect on September 1, 2026, set to rise to 4% from September 1, 2027—reshaping cost structures and price mechanisms across the chain.

Big orders and capacity warnings: an accelerating shakeout

Amid strong demand, leading players are locking in major contracts. On September 18, EVE Energy announced a framework agreement with Fluence to supply 206 GWh of storage batteries over 2027–2031, highlighting overseas expansion and AI data center (AIDC) storage as key battlegrounds. At the same time, capacity expansion remains aggressive: planned storage cell capacity has surpassed 2 TWh industry-wide, with year-end built capacity estimated at 1.2–1.5 TWh versus expected 2026 global shipments of only about 850 GWh—more than double the actual demand. Signals of capacity inventories and deferred approvals for new storage projects have already emerged, making blind expansion increasingly risky.

Solid-state batteries accelerate

On the technology front, solid-state and semi-solid-state batteries are clearly speeding toward commercialization. On September 21, Gotion High-Tech launched its high-power “Morning Star” battery for low-altitude flight, with a cell energy density of 330 Wh/kg and support for both fast charging and battery swapping; a 1,000-tonne-class solid-state electrolyte project by Yibin Chenfeng New Materials was signed in Heyuan, Guangdong with an investment of RMB 530 million; and Yinpai Battery earlier unveiled a 587Ah semi-solid-state storage cell. From low-altitude aviation to long-duration energy storage, next-generation battery technologies are opening up broader application scenarios.

In summary, 2026 marks a pivotal year for the lithium battery industry—one that is transitioning from price wars to value competition. With energy storage taking over as the primary growth engine, players with strong technology, cost control, and global delivery capabilities will gain the upper hand in the ongoing reshuffle. For buyers, closely tracking price windows, securing quality capacity, and aligning with technology upgrade cycles will be the key tasks for the second half of the year.

Key takeaway: The lithium battery industry is running at full throttle — output and installations keep hitting record highs. Meanwhile, solid-state batteries are moving from the lab to production lines at an accelerating pace, with 2027 widely seen as the milestone year for demo deployments. In the upstream market, lithium carbonate prices have corrected sharply, testing supply-chain resilience once again.

1. Demand: boom continues, records keep falling

According to MIIT data, China’s total lithium battery output exceeded 1,240 GWh in H1 2026, up 44% year-on-year. August power battery installations reached 79 GWh — a third consecutive year of growth — and NEV penetration climbed to 60.58%. Monthly output among the six major battery makers rose 7% in September, with Q3 capacity up 19% quarter-on-quarter. Energy storage is now the core growth engine: storage cells account for nearly 40% of September production scheduling, driven by AI data centers and overseas grid projects in the Middle East and the U.S.

2. Technology: solid-state enters the pre-mass-production phase

On the policy front, three national standards for EV solid-state batteries (performance, safety, and life) have been approved for development, with draft comments expected by year-end. China has also secured an IEC project for the world’s first international standard on solid-state batteries.

Industry announcements are coming thick and fast: BYD plans to launch solid-state-powered vehicles in 2027, with a sulfide-route cell at 400 Wh/kg and a prototype CLTC range of 1,218 km; its 20 GWh semi-solid production line in Chongqing will first power the Yangwang U8 and Han L in Q4 this year. CATL has completed a 1 GWh all-solid-state pilot line targeting small-batch production in 2027 — though its executives caution that the technology is only at “level 4 of 9” in maturity, with true scale-up at least five years away. Overseas, Mercedes-Benz-backed ProLogium announced mass production of its Gen 3.5 all-solid-state cell in early September, reaching 381 Wh/kg and 903 Wh/L.

Industry consensus: 2026 is the first year of semi-solid commercialization; 2027 marks demo installations of all-solid-state cells, with large-scale production expected around 2030.

3. Prices: lithium carbonate corrects, supply chain shifts

Lithium carbonate futures have fallen over 40% from their May peak of around ¥210,000/ton, dipping below ¥125,000/ton in mid-September. The correction is largely sentiment-driven — reports of output cutbacks by major cell makers, a shift in inventory statistics methodology, and softer ternary material scheduling. Spot demand remains robust, with basis widening and supply-demand staying broadly balanced for the rest of the year.

On the supply side, copper foil for batteries has moved from nominal overcapacity to effective shortage, with lead times extending for some specifications.

4. New forces: sodium-ion and AI

Since September 1, sodium-ion batteries have had their own HS code, accelerating exports. Hithium unveiled a sodium-ion storage system with a 30-year design life, targeting mass delivery in 2027. With costs 20–30% lower than lithium equivalents, sodium-ion is expected to scale first in storage applications. Meanwhile, AI is reshaping battery R&D — from material screening and intelligent design to smart manufacturing.

Bottom line: Strong demand and price volatility coexist in today’s market. For buyers, tracking raw-material cost trends and solid-state milestones matters more than chasing short-term moves. We’ll keep bringing you the latest industry insights.

Entering September 2026, the lithium battery industry is defined by diverging price and volume trends, tightening policy measures, and accelerating technological progress. Based on the latest production data, raw material pricing, and global policy developments, here are three key insights for cross-border procurement and industrial decision-making.

1. Record-High Production Across All Segments, Consumption Tax Drives Price Pass-Through

According to Xiluo Lithium Battery data, domestic battery production scheduling reached 211.3GWh in September, up 6.3% month-on-month. Output of cathode, anode, separator, and electrolyte materials all rose in tandem, hitting year-to-date highs across the board.

Growth is driven by two core forces: peak demand from domestic energy storage installation and accelerating EV adoption in Europe, and the upcoming year-end export tax rebate window, which has prompted manufacturers to stock up early for shipments.

Meanwhile, China officially imposed a 2% consumption tax on lithium-ion batteries starting September 1, set to rise to 4% in 2027. Solid-state and sodium-ion batteries remain exempt until the end of 2028. Leading manufacturers including EVE Energy and Lishen have already passed the 2% tax cost onto product quotes. With energy storage battery capacity utilization exceeding 90% and mainstream 314Ah ESS cells in tight supply, producers have gained greater pricing power.

2. Lithium Carbonate Price Slumps, Reshaping Industry Profit Structure

On September 11, the main lithium carbonate futures contract plunged nearly 10% intraday to a low of 128,000 yuan/ton. Spot prices stood at 142,300 yuan/ton, down over 35% from the May peak.

The pullback stems from slower-than-expected energy storage project rollouts, weakened demand forecasts for 2027, and ongoing inventory destocking across the supply chain. Notably, price trends have diverged sharply across segments: electrolyte and wet-process separator prices continue to climb, while ternary cathode and LFP prices track lower lithium costs, and anode prices hold steady. This gap reflects widening differences in supply-demand dynamics and bargaining power across production stages.

3. Dual Evolution of Policy and Technology Defines Long-Term Direction

In overseas markets, the European Commission recently proposed a new Public Procurement Act that prioritizes European suppliers for government purchases. Member states may reject bids where more than half of the product value originates outside the EU. The legislation will directly impact exports of large-scale energy storage systems and power batteries, accelerating localization efforts by major Chinese manufacturers in Europe.

On the technology front, the 2026 World Power Battery Conference unveiled breakthroughs including 10-minute ultra-fast charging and 350Wh/kg hybrid solid-liquid batteries, as solid-state technology moves closer to mass production. Meanwhile, CATL launched the largest share buyback program in A-share history (20–40 billion yuan), signaling industry leaders’ confidence in long-term value.

Short-Term Outlook

Production is expected to remain robust in Q4. Lithium prices may face continued near-term volatility. Market participants should monitor the pace of energy storage demand recovery, price transmission following the consumption tax implementation, and industrialization progress of new technology routes such as solid-state and sodium-ion batteries.

September has brought major shifts across the lithium battery industry: a renewed consumption tax on lithium cells is driving a wave of price hikes, lithium carbonate prices have pulled back after a sharp rally, and solid-state batteries are moving from the lab into mass production. Here are four key developments to watch.

1. Policy: consumption tax returns, price hikes spread

In July, China’s Ministry of Finance, the General Administration of Customs and the State Taxation Administration announced that lithium-ion batteries and several other battery types would be subject to a 2% consumption tax from September 1, 2026, rising to 4% from September 1, 2027. Solid-state and sodium-ion batteries remain exempt until the end of 2028.

Following the announcement, leading makers including EVE Energy and Lishen have added the 2% tax cost to their supply prices from September 1, with smaller players following suit. Based on an average ESS cell price of around RMB 0.36/Wh, the new tax adds roughly RMB 7 million per GWh. Underlying the hikes is a tight supply–demand balance: average capacity utilization in the energy-storage battery segment now exceeds 90%, and mainstream 314Ah ESS cells are in short supply, strengthening battery makers’ pricing power.

2. Market: lithium carbonate retreats from its peak

After rallying to around RMB 160,000/tonne in early September, battery-grade lithium carbonate turned lower. SMM data shows spot prices fell to RMB 142,800/tonne on September 8, down about 9% from RMB 159,300/tonne at the end of August; the futures benchmark closed near RMB 142,000/tonne on September 9. Market watchers see the “golden September–silver October” season as a key window for gauging the supply–demand balance, with the price center possibly drifting lower.

3. Technology: solid-state batteries reach mass production

At the 2026 World Power Battery Conference in Yibin (September 3), eight notable innovations were unveiled, including ~10-minute ultra-fast charging cells, a hybrid solid–liquid battery at 350Wh/kg, and high-safety ESS cells scaled from 300Ah to 600Ah.

Solid-state commercialization is accelerating: Taiwan’s ProLogium announced on September 2 that its Gen 3.5 lithium ceramic all-solid-state cell — 381Wh/kg, TÜV-certified, with partners including Mercedes-Benz and NIO — has entered mass production at its gigafactory. CATL said on September 9 that it expects small-batch production of all-solid-state batteries in 2027.

4. Outlook

On the demand side, China’s September battery output is projected to exceed 330GWh, up about 9% month-over-month, pointing to healthy restocking ahead of the peak season. For buyers, near-term cell prices still face upward pressure — locking in long-term agreements and managing inventory cadence may be prudent — while the tax-exemption window for solid-state and sodium-ion technologies creates a favorable environment for adopting next-generation solutions.

September 2026 opens with a cluster of key signals for the global lithium battery market: lithium carbonate prices are swinging at high levels after an August rally, China’s new consumption tax on batteries took effect on September 1, and energy storage cells have overtaken automotive batteries as the industry’s No. 1 demand driver. For overseas buyers, reading these signals correctly is the key to planning procurement timing and budgets for the second half of the year.

1. Energy storage is now the No. 1 growth engine

Global energy storage cell shipments reached 467.84 GWh in H1 2026, up 94.8% year on year (InfoLink), while Chinese storage makers signed a record 817 GWh of new orders in the first half. Industry scheduling data shows that storage cell output accounted for over 40% of China’s total lithium battery production in August, overtaking automotive batteries for the first time. The growth is driven by concentrated deliveries for large-scale storage projects in North America, the Middle East and Europe, with leading cell makers’ orders already booked into 2027. More than 90% of storage cells use LFP chemistry — and China’s LFP cathode exports hit a record 15,379.6 tonnes in June, up 101.7% month on month.

2. Lithium carbonate: high-level volatility, tight supply-demand balance

Battery-grade lithium carbonate spot prices rose from RMB 142,000/t to a peak of RMB 156,000/t in August (+9.9%), easing back to around RMB 150,000/t in the first week of September (100ppi). Futures were far more volatile: the main contract closed at RMB 141,900/t on September 4, down about 9% week on week, dragged by an inventory-statistics methodology revision, a slower destocking pace and rumors of production-schedule cuts at some majors. Yet spot supply remains tight with strong cost support. Mainstream forecasts point to a tight balance through 2026–2027, with prices likely to stay in the RMB 120,000–150,000/t range.

3. China’s consumption tax takes effect — costs are moving up the chain

Since September 1, 2026, China has levied a 2% consumption tax on lithium-ion batteries (rising to 4% from September 2027). Sodium-ion and solid-state batteries remain exempt until the end of 2028, and export orders benefit from a “tax-first, refund-after-export” mechanism. Several leading cell makers have already issued price-adjustment notices, and the industry expects a broad price-increase wave of around 5% by the end of Q3. For buyers, battery and system procurement costs are very likely to keep rising.

4. Technology is accelerating: 600Ah cells, ultra-fast charging, solid-state

The 2026 World Power Battery Conference (September 3–4, Yibin, China) unveiled a series of milestone achievements: storage cells have leapt from 300Ah to 600Ah in mass production, ~10-minute safe fast-charging batteries are coming to market, and 4th-generation high-compaction LFP cathode materials now exceed 200 Wh/kg. In addition, the first international standard for solid-state batteries — led by China — has been approved by the IEC, accelerating the road to commercialization.

Four tips for buyers

1. In a rising-cost cycle, lock in long-term orders and pricing with your supplier early.
2. High-end LFP (high-compaction, large-format storage cells) remains tight — confirm capacity and lead times now.
3. Batteries exported to the EU must comply with the new carbon footprint declaration rules under the EU Battery Regulation — prepare your compliance documents in advance.
4. Monitor lithium prices and the pass-through of the consumption tax, and plan purchases in batches.

As a professional supplier with years of experience in the lithium battery industry, we will keep tracking these developments for you and deliver reliable battery products and supply-chain services.