BEIJING (Reuters) - China's lithium prices rebounded on Friday after a powerful earthquake hit Chile's major lithium producing region, although growing demand concerns weighed on the metal used in electric vehicle batteries.

The most-traded November lithium carbonate futures on the Guangzhou Futures Exchange rose 2.9% to 89,800 yuan ($12,356.89) per metric ton on Friday, having hit a seven-month low of 86,450 yuan in the previous session.

A 7.3-magnitude earthquake hit northern Chile. The Latin American country holds the world's largest lithium reserves, 90% of which are in the Atacama desert, close to the epicentre.

The news triggered supply fears, as Chile is a major exporter to China of lithium chemicals.

That pared some losses earlier this week as investors raised bets that Donald Trump will win the U.S. presidential election in November. The republican has vowed to undo much of President Joe Biden's work to fight climate change, including rules promoting electric vehicles.

"A less-EV-favored Trump administration added to demand concerns, given the already much lower-than-expected EVs sales in the U.S. and Europe this year," Zhang Yuan, an analyst at CITIC Futures, said on Friday.

In Europe, monthly sales for fully electric and plug-in hybrid vehicles fell 7% in June, according to market research firm Rho Motion, while the monthly sales in the U.S. and Canada grew 6%.

Macquarie analysts said in a note last month that EV sales growth in China, the main industry driver, will slow from 30.2% last year to 24.6% this year.

Surging supplies are also weighing on the market. China produced 303,200 tons of lithium carbonate in the first half, up 57.4% from the same period a year earlier, Mysteel data showed.

"Better lithium carbonate prices since March encouraged production. However, producers could curb output as recent price falls squeezed their margins. August is likely to see a decline in output," said Zhang.

Growing surplus drove down prices which had hit an all-time peak in November 2022.

In its latest forecast, CRU expects a global surplus of 90,000 tons of lithium carbonate equivalent for this year.

Citing falling lithium product prices, Chinese producers Ganfeng Lithium and Tianqi Lithium last week warned of losses for the first half of this year.

($1 = 7.2672 Chinese yuan renminbi)