SMM Analysis on the Impact of Development of the Cobalt-Free Battery on the Cobalt Industry

SHANGHAI, Dec 29 (SMM) - According to the Catalogue of the 11th Batch of Recommended Models for the Promotion and Application of New Energy Vehicles in 2021 released by the Ministry of Industry and Information Technology (MIIT), the first car model developed by SAR, which is the high-end car brand owned by Great Wall Motor, is equipped with cobalt-free batteries from SVOLT Energy.
According to relevant information, the energy density of the cobalt-free battery system of SVOLT Energy that supports the SAR model is 168 Wh/kg, the battery capacity is 107.92 KWh, and the Certification For Long-Term Care (CLTC) is 802 km. The system supports 800 V+480 KW high-voltage fast charging technology, and car models that are equipped with the battery can travel 400 km in 10 minutes of charging.
According to relevant personnel, SVOLT Energy’s cobalt-free batteries have already started supporting the major models developed by domestic first-tier car companies, such as ORA Shandian Mao, Hao Mao, SAR, etc., which have started mass production. It is expected that more models will be equipped with cobalt-free batteries in the later period. The cobalt-free battery may become the major product of SVOLT Energy, pushing up the installed power of SVOLT Energy.  

As a high-tech enterprise of global energy interconnection, SVOLT Energy released a power battery system solution with higher safety and longer battery life at the just-concluded third battery day--Longlinjia battery, covering cobalt-free, ternary, LFP, etc. In 2023, the Longlinjia battery will also be launched on mass-produced models, which will help speed up the market application of SVOLT Energy's cobalt-free batteries.

According to foreign media, SK On, a battery manufacturing subsidiary of SK Group, also plans to develop a cobalt-free battery within three years.

Cobalt is a key raw material for ternary batteries that are used for electric vehicles due to the cobalt’s role in stabilising the chemical reaction of the battery. Removing or reducing the proportion of cobalt with higher prices in the battery will reduce the costs.

SMM believes that the development of batteries with high nickel but low cobalt content and cobalt-free batteries will hit the cobalt industry. At present, the cobalt demand mainly comes from the battery and alloy sectors, and the former includes LCO batteries and ternary batteries. 3C products mainly apply the LCO battery. However, in 2022, due to the global COVID-19 outbreaks and gloomy economic prospects, the electronic industry experienced a tough time. Demand for raw materials such as LCO, Co3O4 and cobalt chloride remained sluggish and has not yet improved. Although demand from the ternary battery sector was better in the year, the development of batteries with high nickel but low cobalt content greatly weakened cobalt consumption.
In 2022, the highest prices of SMM cobalt sulphate appeared on March 11, with an average daily price of 120,000 yuan/mt. On December 29, the average price of SMM cobalt sulphate was 48,000 yuan/mt, dipping about 60%. The falling prices were contributed by the poor demand and the steadily growing cobalt output from overseas cobalt mines. The Chinese lithium battery recycling industry is mushrooming. According to SMM data, from January to November 2022, the output of cobalt sulphate totalled 75,200 mt in metal content, up 31% year-on-year. The sluggish demand for cobalt has led to an oversupply in the cobalt market in 2022, and this situation may continue until 2023. Pessimism fills the cobalt market.