Tesla and Glencore sign cobalt long order policy to add new energy vehicles to push up the non-ferrous cobalt plate

SMM6 March 17: 17 morning trading, A-share metal cobalt plate strengthened again, cold cobalt industry pulled up the contact plate, Huayou cobalt industry, Shengtun mining industry, Luoyang molybdenum industry rose.

Yesterday, it was reported that Tesla and Glencore had reached a long-term agreement on the supply of cobalt, with an annual supply of about 6000 tons. The market believes that the large order signed by Tesla and Glencore is mainly due to a significant increase in the demand for cobalt by Tesla's plant expansion in China. Secondly, some international NGO organizations have launched a large number of lawsuits against electronics giants, including Apple, Google, Microsoft and Dell, on the grounds that the lithium batteries of their products use cobalt in the Democratic Republic of the Congo. Child labor and hand grabbing are involved in cobalt mining in the Congo gold mine. The main purpose is to avoid the trouble caused by the litigation of NGO organization on the issue of cobalt mining.

Zhongtai Securities believes that the bottom of cobalt price is constantly tamped and the three-year new cycle is clear. The short-term tightening of raw materials leads to the rebound of cobalt price, the expectation of downstream demand recovery is increasing, the epidemic continues to disturb the supply of cobalt ore, Q3 enters the inflection point of "demand bottom + supply top", and the logic of mismatch between supply and demand in the second half of the year may be gradually verified. From the medium to long-term point of view, the closure of the Mutada mine at Glencore in 2019 sets the tone of medium-and long-term cobalt supply contraction, countries increase support for new energy vehicles, overseas car companies accelerate the layout of new energy vehicles, under the resonance of supply and demand, cobalt prices may enter the upward cycle.

At the same time, on the morning of June 16, the National Development and Reform Commission held a regular press conference in June. The press conference pointed out that it will actively promote the renewal, replacement and recycling of household appliances and cars, and accelerate the development of new forms of consumption. Prior to this, many places have launched car replacement subsidy policy. In the notice of promoting consumption in Hubei Province on May 22, it was clearly proposed to encourage qualified areas to subsidize cars "trade in clunkers for new ones". In June, Shenzhen launched a new energy subsidy policy, in which old car owners can enjoy up to 40,000 yuan in benefits for replacement. Promoting "trade-in" is an effective measure to promote automobile consumption. The continuous introduction of policies has stimulated the market of new energy vehicles to a certain extent, driving the demand for cobalt-containing ternary batteries.

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