[SMM Analysis] NCM Manufacturers Still Hold a "Buy on the Rise, Not on the Decline" Mentality

This week, NCM material prices continued their downward trend. On the raw material side, influenced by the international situation, the non-ferrous metals sector experienced a significant correction. The transaction price of lithium carbonate dropped notably due to weaker market trends, lithium hydroxide followed suit, nickel sulfate continued to decline, cobalt sulfate prices remained stable, while manganese sulfate saw a slight increase. Overall, these factors exerted downward pressure on ternary material prices.

Although raw material prices are currently at a relatively low stage, market sentiment has not improved significantly. Manufacturers' enthusiasm for inquiries and offers has weakened, and trading volumes have not increased notably. The main reason is that some manufacturers still adhere to the "buy on the rise, not on the decline" mentality. Additionally, as they had already stocked up during the price correction last week, their procurement demand before the holiday is limited, and most are currently taking a wait-and-see approach.

In terms of payables, the payables for February remained largely unchanged compared to the previous month. With the Chinese Spring Festival approaching, some manufacturers prefer to maintain existing payable levels before the holiday and postpone negotiations until after the festival, resulting in limited payable adjustments recently. Compared to last year's model, which relied heavily on long-term agreements, more manufacturers are now opting to negotiate order terms on a monthly or quarterly basis.

On the production side, as the Chinese Spring Festival holiday approaches, manufacturers generally slowed down their production pace, with some companies having already taken early holidays or commenced routine maintenance. Downstream procurement willingness also remained subdued, leading to an overall narrowing of shipment volumes.