Lithium carbonate prices sank by 60% year-to-date to under CNY 215,000 in April, the lowest in 17 months, as robust output and weak demand continued to raise expectations of a supply surplus this year. The Chinese government ended cash subsidies for households purchasing new energy vehicles, pressuring demand for battery-powered vehicles and increasing stocks throughout the country. The overproduction of batteries at the end of 2022 to take advantage of subsidies also attributed to the unsustainable inventory growth and prompted the sale of goods at a steep discount, with sharp capacity cuts in all streams of the supply chain. The bearish outlook persisted in the near term despite the EUs decision to phase out carbon-emitting cars by 2035 and reports on processing rate reductions from multiple carbonate producers. Furthermore, Reuters said that Chinese manufacturers agreed on a price floor of CNY 250,000 per tonne to combat the slump.