Battery-material giant Ganfeng Lithium (002460) has announced a delay in spending on projects without significant near-term returns after reporting a first-half financial loss. The Chinese company experienced a net loss of 760.4 million yuan, contrasting with profits from the previous year. Consequently, it plans to control spending and optimize capital usage.

Focus on Immediate Benefits

Ganfeng, operating in China and other countries like Argentina and Australia, will prioritize projects with immediate returns, postponing others that do not align with this strategy. While continuing to acquire global resources, the company stated that capacity expansions will depend on future demand.

Challenging Market Conditions

The lithium industry faces turmoil with supply exceeding demand, pushing prices to a three-year low. This situation has squeezed margins, leading companies to reassess expansion strategies. According to UBS Group, the market will likely remain in surplus until 2027, affecting price forecasts.

Investment and Strategy

Ganfeng invested 38 million yuan in futures trading in the first half and made a profit of 3.43 million yuan. The company aims to lower cross-border investment risks by setting up a derivatives-trading desk.

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