Refined cobalt:
At the beginning of this week, refined cobalt prices consolidated at lows. Supply side, since last week when an overseas miner announced the acquisition of low-priced intermediate products in the market, a clear signal to hold prices firm was sent to the market. Boosted by this, electronic trading prices rebounded from around 290,000 yuan/mt to above 300,000 yuan/mt, and have since moved sideways. Driven by the recovery in market sentiment, traders who had previously suspended quotations gradually resumed offering this week, with spot-futures price spreads quoted at premiums of 1,000-13,000 yuan/mt; mainstream smelters maintained EXW prices at 310,000 yuan/mt. Demand side, downstream enterprises have not yet ended their summer break, and overall purchasing was mainly restocking for rigid demand, with limited improvement in trading activity. In the short term, ore-side price support provides some underpinning for prices, but with insufficient demand follow-through during the off-season, room for price rebounds may be constrained. Going forward, attention should be paid to the pace of downstream restocking after the summer break and the sustainability of intermediate product purchases.
Intermediate products:
This week, the cobalt intermediate products market remained in a stalemate, but the center of the standoff shifted notably lower. Recently, an overseas enterprise sold a small volume of off-spec material at $15/lb, dealing a clear blow to market sentiment. To stabilize market expectations, an overseas miner announced at the beginning of the week that it would acquire low-priced intermediate products at $16/lb and below, sending a clear signal to hold prices firm. In terms of quotations, most miners still insisted on target prices above $20/lb, but downstream purchase intentions, dragged down by falling cobalt salt prices, have further pulled back to $15-18/lb. The price spread between buyers and sellers remains wide, recent tenders have largely failed, and transactions remain difficult. In the short term, miners' move to acquire low-priced cargoes may provide some support for the price floor, but until the psychological price gap between upstream and downstream narrows, substantive transactions are unlikely to materialize, and the stalemate is expected to persist.
Cobalt sulphate:
At the beginning of this week, the cobalt sulphate market remained sluggish. Recently, low-priced transactions of Indonesian cobalt sulphate at 63,000 yuan/mt dealt a clear blow to the market and became the main source of downward pressure on prices. Supply side, MHP cobalt payables have currently pulled back to around 70%, bringing spot production costs down to about 69,000 yuan/mt, further weakening cost support. Producers using primary materials and recycled materials have adopted consistent pricing strategies, with quotations holding firm at the 70,000 yuan/mt level. If downstream enterprises show clear purchase intentions, producers may consider selling at around 65,000-68,000 yuan/mt. Demand side, downstream purchase intentions are generally anchored to the earlier low-priced transaction at 63,000 yuan/mt, with target prices at or below 63,000 yuan/mt. The price spread between buyers and sellers is wide, and actual transactions remain difficult. With month-end approaching, some enterprises have begun signing new orders. Currently, downstream target prices are at or below 90% of the SMM low-end price, while upstream enterprises are targeting 93-95%. In the short term, with the September-October peak season approaching, downstream demand is slowly recovering, and enterprises have stockpiling needs. From late August to early September, prices may gradually stop falling and stabilize. However, current market sentiment remains weak, and a price improvement will need to wait for clear signals of concentrated downstream purchasing.
Cobalt chloride:
This week, the cobalt chloride market operated steadily overall, with limited inquiries and actual transactions. Market trading sentiment was subdued, and prices showed no significant changes. Currently, all segments of the industry chain are operating cautiously, with market participants mainly on the sidelines. As September approaches, enterprises are shifting their focus to downstream demand, and the market generally expects purchasing conditions to improve in September, providing some support for prices.
Cobalt salt (Co3O4):
This week, the Co3O4 market operated steadily overall, with trading volume still relatively limited. Currently, enterprises are mainly maintaining routine production and delivering previously signed long-term contracts, with relatively few new orders and spot transactions. Overall market activity was mediocre. As upstream cobalt chloride prices have not declined significantly recently, the cost side of Co3O4 has not been notably disrupted, and enterprises are under no obvious pressure to cut prices. Meanwhile, downstream new purchasing demand has not yet been clearly released, and the market lacks further upward momentum. In the short term, the Co3O4 market is expected to remain largely stable, with prices likely to move sideways.
Cobalt powder and others:
At the beginning of this week, cobalt powder prices consolidated at lows. Supply side, smelters' spot order quotation ranges shifted down to 410,000-430,000 yuan/mt, with some bulk tender orders transacted at 400,000 yuan/mt or slightly lower. In the trading segment, the lowest transaction price once dipped to 385,000 yuan/mt. According to SMM, this cargo was likely old inventory from earlier periods, as new material cannot follow at that price level due to cost constraints. The guidance effect of individual low-priced transactions on market prices is limited. Demand side, orders from downstream cemented carbide enterprises remained weak, raw material inventory digestion was slow, and apart from normal pick-ups under long-term contracts, spot order purchases remained sporadic. Overall market trading sentiment was sluggish. In the short term, with the September-October peak season approaching, if downstream stockpiling demand is gradually released, prices are expected to gradually stop falling and stabilize in September. However, before concentrated downstream purchasing clearly emerges, cobalt powder prices lack momentum for a reversal and are expected to continue their weak trend of hitting bottom.
Ternary cathode precursor:
At the beginning of the week, ternary cathode precursor prices weakened. Today, nickel sulphate prices declined, while cobalt sulphate and manganese sulphate prices remained stable.
In terms of discounts, for September and Q3 orders, some producers still intend to hold prices firm due to the higher cost of sulphate raw materials in the earlier period. For long-term contracts, some producers had already agreed on annual contracts at the beginning of the year, and most producers have not yet raised their coefficients. Downstream acceptance of coefficient increases for quarterly orders also remained weak. Except for some top-tier producers with certain bargaining power, most producers kept coefficients largely stable with Q2. For spot orders, as nickel and cobalt salt prices have been relatively weak recently, some downstream enterprises are seeking raw material toll processing or expanding in-house production, and September order coefficients remain under pressure.
In terms of production, top-tier producers' export orders remained strong this month, with production schedules at relatively high levels. Some domestic top-tier producers have slight reduction expectations, while some other small and medium-sized producers still have relatively low production schedules due to the off-season.
Looking ahead, sulphate prices have not yet shown a clear rebound, and future new order prices will depend on actual downstream demand during the September-October peak season.
Ternary cathode material:
At the beginning of this week, ternary cathode material prices rebounded somewhat. Raw material side, nickel sulphate prices continued to decline, but lithium carbonate and lithium hydroxide prices rebounded notably, driving ternary cathode material prices higher. Lithium chemicals are still in a phase of significant fluctuations, and producers remain cautious in placing orders. Demand side, in the domestic EV market, some battery cell manufacturers have slowed their cargo pick-up pace, mainly because automaker orders were weaker than expected; export orders remained at relatively high levels. Currently, domestic ternary cathode production schedules may trend downward month by month starting in September, with only export orders potentially providing slight support to demand before November. Subsequent growth momentum appears somewhat insufficient. Against this backdrop, raw material purchasing sentiment is also very subdued, and the boost from ternary demand to raw material prices is expected to be extremely limited going forward.
LCO:
This week, LCO market prices remained largely stable, with overall fundamentals still weak and the peak season boost falling short of expectations. Supply side, overall fluctuations were limited, with cathode enterprises maintaining low operating rates and a produce-based-on-sales strategy, keeping industry output relatively stable. Demand side, performance was mediocre, with downstream purchasing still mainly on a rigid-demand, as-needed basis, and no large-scale concentrated stockpiling has emerged. The traditional September-October seasonal driver has not materialized as expected, market expectations for peak season stockpiling have cooled, inventory digestion across the industry chain has been slow, and the supply-demand pattern has not yet shown substantive improvement.
Overall, at the current stage, the cost side provides some support, and with no further downstream push for lower prices, LCO prices have gained some breathing room in the short term, with the market mainly consolidating and holding steady. However, end-use demand lacks upward driving force. If end-use stockpiling in September continues to fall short of expectations, the market still faces potential risks of weakening again.
News:
[Energy storage demand becomes a new engine for the lithium market; lithium producers reap hefty profits] The rapidly growing energy storage industry has boosted demand for battery metals and pushed up lithium prices, allowing lithium producers to achieve hefty profits. Major Chinese lithium producers Tianqi Lithium and Ganfeng Lithium both posted their highest H1 net profits in three years. US-based Albemarle said global lithium demand rose 45% YoY through May, outpacing supply growth. Australia's PLS Group also delivered strong performance, posting a profit of A$526 million (approximately $377 million) in the 12 months ended June 30, compared with a loss in the prior-year period. PLS Group is also bullish on lithium prices in the coming months, as it expects a supply deficit in the market. (Jin10 Data APP)
[Levima Advanced Materials: The company's VC unit is currently operating stably, with all products produced and sold] Levima Advanced Materials said on an investor interaction platform that due to the rapid development of end-use markets such as new energy vehicles and energy storage, as well as constraints on effective capacity supply, the supply of lithium battery additive VC products has gradually tightened since the beginning of this year, and market prices have shown a steady upward trend. The company's VC unit has achieved independent technological breakthroughs in key production processes, with higher conversion rates and lower energy consumption. The raw materials used are mainly self-supplied, giving it notable technological and industry chain advantages. Currently, the company's VC unit is operating stably, with all products produced and sold. (Jin10 Data APP)
[Ministry of Commerce: Deepen the pilot reform of automobile circulation and consumption, and accelerate the removal of unreasonable restrictive measures in the automobile circulation and consumption sector] The Ministry of Commerce and seven other departments issued implementation opinions on promoting the expansion and upgrading of commodity consumption. The opinions pointed out the need to deepen the pilot reform of automobile circulation and consumption, accelerate the removal of unreasonable restrictive measures in the automobile circulation and consumption sector, innovate automobile use management models, and expand automobile consumption across the entire chain. Relevant regions should be encouraged to optimize car purchase restrictions to better meet residents' car purchase needs. The automotive aftermarket should be cultivated and expanded, supporting the development of car modification, repair and maintenance, motorsports, and RV camping, and establishing a recognition and management system for traditional classic cars. Inter-departmental information sharing mechanisms should be improved, and an information interaction system covering the entire life cycle of automobiles, including sales, registration, repair, insurance, and retirement, should be established. The management system for used car circulation should be improved, mutual recognition of unified invoices for used car sales should be advanced, and used car business entities should be subject to tiered and classified management.
Data source statement: Except for public information, all other data are processed by SMM based on public information, market communication, and SMM's internal database models, and are for reference only and do not constitute decision-making advice.
SMM New Energy Research Team
Wang Cong 021-51666838
Ma Rui 021-51595780
Lin Ziya 86-2151666902
Feng Disheng 021-51666714
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
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