[SMM Cobalt Morning Meeting Minutes] New Energy Industry Chain Demand Differentiation, Market Awaits Gradual Recovery in Peak Season

Refined Cobalt:

This week, the spot price center of refined cobalt continued to edge lower, drifting downward. Supply side, mainstream smelters lowered their EXW prices to 355,000 yuan/mt, while other small and medium-sized smelters largely suspended external price quotes due to mounting losses. In the trading segment, after a period of sustained destocking, available inventories had fallen to relatively low levels. Some enterprises, based on bullish expectations for the future market, began to slow their selling pace. For the few enterprises still offering prices, the spot-futures price spread remained in a premium range of 1,000-10,000 yuan/mt. Demand side, downstream enterprises were still in their summer break period, with generally weak purchase willingness, only maintaining a small amount of just-in-time procurement for restocking. Overall, from July to August is the traditional consumption off-season for refined cobalt, with limited support from the demand side, and prices may remain in the doldrums in the short term.

Cobalt Intermediate Products:

This week, cobalt intermediate products market trading activity remained sluggish, with limited transactions, and the price center slowly edged lower. Recently, some Chinese-funded miners initiated tenders for intermediate products, with intended prices dipping below $22/lb. Affected by the sustained weakness in cobalt salt and refined cobalt prices, downstream smelters and traders' psychological price levels for raw materials further pulled back to around $20-21/lb, and some enterprises could only accept prices below $20/lb, thus actual transactions were still not reached. In the short term, miners' willingness to hold prices firm remains, but downstream demand support is insufficient, the standoff between the two sides continues, and price improvement still awaits the recovery of actual demand.

Cobalt Sulphate:

This week, the divergence between upstream and downstream in cobalt sulphate further intensified, with limited actual transactions. Supply side, primary smelters using intermediate products and MHP held their offers firm above 80,000 yuan/mt, supported by costs; recyclers, leveraging raw material cost advantages, concentrated their offers at 76,000-78,000 yuan/mt, with a few eager sellers able to go below 75,000 yuan/mt. The demand side remained weak, with downstream enterprises showing insufficient purchase willingness and tending to seek non-standard or old-stock cargoes to lower procurement costs. Recently, substandard products and old-stock material were traded below 73,000 yuan/mt. After adjusting for quality, the actual difference from fresh products was limited, but in a weak demand environment, this price level was used by buyers as a bargaining benchmark, forcing some recyclers to follow suit and cut prices. Additionally, after refined cobalt fell steadily, the cost of producing cobalt sulphate via re-dissolution had dropped to 72,000-73,000 yuan/mt, further reinforcing downstream expectations of pushing for lower prices. In the short term, the cobalt salt market trend shows a slow decline, and a stabilization and recovery of prices still awaits the release of concentrated downstream restocking demand, with this period expected after mid-to-late August.

Cobalt Chloride:

This week, the cobalt chloride market remained in a sluggish pattern, with transactions at sporadic levels. Supply side, from a real-time cost perspective, the costs of routes using recycled materials and re-dissolving refined cobalt were already significantly below current market asking prices and actual transaction prices. The key factor influencing enterprise pricing was the large-scale inventory held by upstream smelters, mostly high-cost inventory. Facing the market's sustained drop, they were unable to lower their average cost through low-price procurement, so high-cost inventory provided some support for quotes, keeping them relatively firm overall. But at the same time, some enterprises had begun to gradually lower their quotes to promote shipments, trying to gradually dilute previous losses by accelerating turnover. However, downstream acceptance was extremely limited, and even price cuts were not enough to achieve volume sales. Demand side, LCO producers' own inventories were already high, with no signs of demand growth, and their current purchase willingness was extremely low. Overall, there is still downside room for cobalt chloride prices in the short term.

Cobalt Salt (Co3O4):

This week, Co3O4 market trading was also sluggish, with low trading volumes. Supply side, facing persistently sluggish demand, each enterprise's output and shipments had been at low levels since the start of the year. To compete for market share and boost shipments, enterprises had to adopt a price-cutting strategy, which had significantly squeezed profit margins compared to earlier, but actual shipments did not noticeably improve. Demand side, although battery cell plant production schedules saw some recovery, the growth did not transmit to the LCO segment. One important reason was that the proportion of downstream switching to ternary cathode materials had increased. Overall, the likelihood of stable to weaker LCO prices remains.

Cobalt Powder and Others:

This week, the cobalt powder market continued its weak trend. Quotes from mainstream producers were at 455,000-465,000 yuan/mt, with some transaction prices dipping to 450,000 yuan/mt, and low-price offers in the trader segment touched 440,000-450,000 yuan/mt. Pressure along the industry chain was still gradually transmitting upward. Downstream cemented carbide enterprises, constrained by end-user order performance, saw no acceleration in raw material consumption speed, and their procurement pace lengthened. Except for long-term contract orders, spot order transactions were relatively limited. In the middle trading segment, willingness to sell increased somewhat, and some low-priced resources further lowered the market's psychological price level. On the raw material side, cobalt carbonate prices were under pressure, with market trading tending to stagnate after approaching the 200,000 yuan/mt mark, lacking effective transaction guidance. From the perspective of market sentiment, participants mostly held a wait-and-see attitude, generally believing the market could only see improvement after August-September.

Ternary Cathode Precursor:

This week, remained stable. This week, edged up, declined, and edged down.

On the discount front, for August and Q3 orders, some producers had the willingness to raise discounts due to the high cost of sulphate raw material earlier. For long-term contracts, some producers' annual agreements had been settled at the start of the year with coefficients not yet raised. Downstream acceptance of coefficient increases for quarterly contracts was also weak, with levels basically stable compared to Q2. For spot orders, due to the relatively weak recent performance of nickel and cobalt salt prices, some downstream enterprises sought toll processing for raw materials, and overall, August order coefficients were expected to be stable MoM from July.

In terms of production, top-tier producers' export orders performed well again this month, with production schedules at relatively high levels. The production load of domestic top-tier producers also recovered slightly, but some small and medium-sized producers still had relatively low production schedules due to the off-season.

Looking ahead, sulphate prices have yet to show a clear rebound, and future new order prices will need to watch the downstream stockpiling pace in Q3.

Ternary Cathode Material:

This week, ternary cathode material prices changed little, basically stable. From the raw material side, nickel sulphate and manganese sulphate prices were temporarily stable, cobalt sulphate transaction prices continued to decline, and lithium carbonate and lithium hydroxide were in a stage of small fluctuations. In terms of trading sentiment, recently, battery cell manufacturers maintained just-in-time procurement, and market transactions were relatively mediocre. Discount-wise, as demand saw no further growth, battery cell manufacturers' acceptance of discount increases was not high. Meanwhile, the lithium battery consumption tax was about to be restored, and battery cell manufacturers may pass some cost pressure upstream, making it further difficult to raise discounts. On the demand side, China's and overseas EV markets maintained a relatively high demand level in July, with producers' actual output not differing much from original expectations. The impending tax restoration prompted some battery cell manufacturers to stockpile in advance, with August orders stable and showing slight growth. The consumer market demand still showed no signs of recovery, performing relatively flat. As the September-October peak season approaches, overall future demand in the ternary market is expected to have room for further growth.

LCO:

This week, the LCO market was relatively stable. Supply side, facing persistently sluggish demand, each enterprise's output and shipments had been at low levels since the start of the year. To compete for market share and boost shipments, enterprises had to adopt a price-cutting strategy, which has significantly squeezed profit margins compared to earlier, but actual shipments did not noticeably improve. Demand side, although battery cell plant production schedules saw some recovery, the growth did not transmit to the LCO segment. One important reason was that the proportion of downstream switching to ternary cathode materials had increased. Overall, the likelihood of stable LCO prices remains.

News:    

[National Energy Administration: H1 Electricity Consumption in Battery Swapping Services Up 56.9% YoY] From the press conference held by the National Energy Administration today, it was learned that in H1 this year, total electricity consumption grew 5.3% YoY. Among this, tertiary industry electricity consumption grew rapidly, with battery swapping services and internet data services seeing strong growth. Consumption in battery swapping services and internet data services reached 81 billion kWh and 49.4 billion kWh, respectively, up 56.9% YoY and 44% YoY, together boosting total electricity consumption by 0.9 percentage points. (CCTV News)

[First Meeting of the China-Germany Intelligent Connected Vehicle Specifications and Standardization Working Group in 2026 Held in Beijing] According to the China Automotive Standardization Research Institute, on July 29, 2026, the National Technical Committee of Auto Standards Intelligent Connected Vehicles Subcommittee (SAC/TC114/SC34) and the German Association of the Automotive Industry (VDA) organized a meeting of the China-Germany Intelligent Connected Vehicle Specifications and Standardization Working Group in Beijing. Against the backdrop of China-Germany cooperation on intelligent connected vehicles, delegations from both sides exchanged views and discussed progress on standard and regulation research and implementation experiences, and initiated joint research projects. Experts from CATARC, the Equipment Center, BMW, TÜV Rheinland, and Bosch shared information and communicated on various topics, including China's pilot progress on ICV market access, the European DCAS framework, the progress of application guidelines for combined driver assistance safety requirements, the implementation practice of EU automotive data regulations, progress and standardization of parking-related standards, and global regulation adaptation and best practices. They also launched the China-Germany joint research project on standardization requirements for cross-border automotive data flows. (Jin10 Data)

[Dongfang Zirconium: Co's Zirconia Samples Applied in Solid-State Battery Electrolytes Receive Preliminary Recognition from Some Solid-State Battery Material Producers in R&D Trials] On July 29, Dongfang Zirconium stated on an interactive platform in response to investor questions that its zirconia samples applied in solid-state battery electrolytes had received preliminary recognition from some solid-state battery material producers in R&D trials. If the standard for information disclosure is met, the company will disclose in a timely manner.
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SMM New Energy Research Team

Wang Cong 021-51666838

Ma Rui 021-51595780

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Lyu Yanlin 021-20707875

Zhou Zhicheng 021-51666711

Wang Zihan 021-51666914

Wang Jie 021-51595902

Zhang Haohan 021-51666752

Chen Bolin 021-51666836

Xu Mengqi 021-20707868