(Yicai Global) March 4 -- China's Contemporary Amperex Technology has refuted a rumor that claimed the battery giant is reducing its output this month amid rising raw material prices.

The rumor is fake news, Securities Times reported yesterday, citing the Ningde-based company.

Prices of battery-grade lithium carbonate exceeded CNY500,000 (USD79,125) per ton on March 2, up about 67 percent from Jan. 1, according to data from consultancy Xinluo Network Technology. The latest hike to CNY500,000 per ton from CNY400,000 per ton took about 20 days. Lithium carbonate is the main raw material of lithium-ion battery's cathode material.

A mismatch between supply and demand is the core reason behind the big price increase of lithium resources, according to industry professionals. Each lithium mine's supply is limited and the average development cycle of new minerals ranges from three to five years. Meanwhile, the demand has exploded, driven by new energy vehicle firms.

CATL Chairman Zeng Yuqun is preparing to submit his proposal during the fifth session of the 13th National Committee of the Chinese People’s Political Consultative Conference to suggest that the government should introduce measures to guarantee lithium resource supply and prices, Yicai Global learned.

China should accelerate the exploration and development of domestic lithium resources and introduce new technologies to increase the recycling and reuse of battery materials, according to the proposal.

CATL has invested over CNY10 billion (USD1.6 billion) in lithium projects around the globe via equity purchases to gain rights to buy the finished products.

Editors: Tang Shihua, Emmi Laine, Xiao Yi