Lithium stocks rose in early trading. By the time of writing, Tianqi Lithium (09696) was up 4.46%, trading at HK$55; Ganfeng Lithium (01772) was up 3.45%, trading at HK$58.45. On the news front, on the morning of January 12th, the main lithium carbonate futures contract hit the daily limit up, gaining 9% to 156,060 yuan per ton. On January 9th, the Ministry of Finance and the State Taxation Administration issued an announcement regarding the adjustment of export tax rebate policies for products such as those related to photovoltaics. It indicated that from April 1, 2026, to December 31, 2026, the VAT export rebate rate for battery products will be reduced from 9% to 6%; starting January 1, 2027, the VAT export rebate for battery products will be cancelled. According to the Futures Daily, CITIC Futures analyst Wang Meidan believes that from a demand perspective, battery companies might increase battery production scheduling for "rush exports" before April, which would benefit short-term lithium carbonate demand; furthermore, leading up to the cancellation of the rebate in 2027, battery manufacturers will still have sustained "rush export" demand. Therefore, in the short term, this presents a positive factor for lithium carbonate prices. However, the cancellation of the export rebate implies reduced profit margins across the supply chain, and the increased costs are highly likely to be passed on to the end consumer, which could somewhat suppress demand in the long run.
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