[SMM Weekly Review] Cobalt Market Remains Weak, Prices Continue to Decline Steadily

Refined Cobalt:

Refined cobalt spot prices fell sharply this week. On the supply side, mainstream smelters lowered their ex-works quotations to 402,000 yuan/mt. After the rapid decline, most traders suspended their offers. The persistently weakening demand-side market suppressed the downstream procurement pace. Alloy and magnetic material producers, affected by the sentiment of rushing to buy amid continuous price rise and holding back amid price downturn, mostly postponed stockpiling and stayed on the sidelines. This round of price decline was not driven by significant fundamental bearish catalysts; the market generally judged that the correction was mainly led by capital trading activities. In the short term, the futures market remains under pressure and fluctuates. For refined cobalt to stabilize, two conditions are needed: first, an easing of corporate cash flow pressure and a reduction in market selling volumes; second, a stabilization of the cobalt salt and related product markets to form a price floor.

Cobalt Intermediate Products:

Cobalt intermediate product prices maintained a fluctuating trend this week. On the supply side, mainstream miners and traders maintained offers at $25.5/lb, but the cobalt salt market remained persistently weak. Downstream smelters adopted a conservative purchasing stance, with intended purchase prices generally below $25/lb. Currently, cobalt intermediate products carry a high premium compared to other cobalt raw materials. Some smelters plan to sell their intermediate products at $24.8-24.9/lb and instead purchase low-priced recycled black mass to reduce costs. On the logistics front, there have been no reports of leading miners booking shipping space collectively. Large volumes of cargo are expected to arrive at the port around August. In the short term, end-use demand support is insufficient, and prices are likely to stay flat. For the market to strengthen, a recovery in downstream operating rates combined with a restoration of cobalt salt prices is needed to form a joint support.

Cobalt Sulphate:

The cobalt sulphate market saw sluggish trading this week, with intensified bargaining between upstream and downstream, and prices continued to decline slowly. On the supply side, quotations from primary smelters remained firm, with mainstream quotation ranges at 87,000-90,000 yuan/mt. Some recycling smelters and traders, under cash flow pressure, released low-priced cargo, with offers falling to 82,000-84,000 yuan/mt. On the demand side, the persistent gradual decline suppressed downstream stockpiling enthusiasm, with downstream enterprises' psychological purchase prices at only 81,000-82,000 yuan/mt. The price spread between buyers and sellers was significant, making actual transactions difficult to complete. In the short term, the weak pattern of cobalt sulphate prices is difficult to change. A stabilization and rebound will require substantial fulfillment of downstream concentrated restocking demand.

SMM New Energy Research Team

Wang Cong 021-51666838

Ma Rui 021-51595780

Feng Disheng 021-51666714

Lü Yanlin 021-20707875

Xiao Wenhao 021-51666872

Zhang Haohan 021-51666752

Wang Zihan 021-51666914

Wang Jie 021-51595902

Xu Yang 021-51666760

Yang Lianting 021-51595835

Wang Zhaoyu 021-51666827