High inventory levels combined with macro disturbances kept refined cobalt prices in the doldrums, while cobalt chloride continued to rise! [Weekly Observation]

SMM April 11 News: This week, cobalt product quotes showed mixed performance, with only cobalt chloride rising slightly, while refined cobalt, cobalt sulphate, and Co3O4 spot prices fell to varying degrees. Among them, refined cobalt spot prices continued to face downward pressure due to high overall inventory levels in the market and macro event disturbances... SMM compiled the price changes of related products in the cobalt market this week, as follows:

Refined cobalt: According to SMM spot price data, refined cobalt spot prices continued to decline this week, falling for four consecutive trading days before stabilizing briefly on the last trading day. As of April 11, refined cobalt spot prices stabilized at 218,000-250,000 yuan/mt, with an average price of 234,000 yuan/mt, down 10,000 yuan/mt from April 3, a drop of 4.1%.

According to SMM, fundamentally, on the supply side, current spot inventory in the market is high, and smelters' willingness to sell is weak amid falling prices. On the demand side, downstream sentiment is generally cautious, with inquiries and buying activity subdued. Overall, due to high overall inventory levels of refined cobalt and macro event disturbances, refined cobalt spot prices remain in the doldrums.

Next week, the overall supply and demand situation for refined cobalt is unlikely to improve, and spot prices may continue to fluctuate weakly.

Cobalt salts (cobalt sulphate and cobalt chloride): According to SMM spot price data, cobalt sulphate spot prices also showed a downward trend this week, falling for the last three consecutive trading days before dropping to 48,500-50,200 yuan/mt on April 11, with an average price of 49,350 yuan/mt, down 300 yuan/mt from April 3, a drop of 0.6%.

According to SMM, on the supply side of cobalt sulphate, mainstream salt producers continue to maintain a firm pricing strategy, but the price alliance has shown signs of loosening, with a small number of salt producers lowering their quotes. Coupled with the drag of low-priced old stock in the market, cobalt sulphate spot prices have weakened. On the demand side, under the influence of macro events, downstream companies are dominated by a wait-and-see attitude, with purchase willingness significantly weakened, resulting in overall weak market transactions.

Next week, market sentiment is unlikely to improve, and cobalt sulphate spot prices may continue to fluctuate.

Cobalt chloride: According to SMM spot price data, cobalt chloride prices rose slightly this week. As of April 11, cobalt chloride spot prices increased to 59,500-61,000 yuan/mt, with an average price of 60,250 yuan/mt, up 250 yuan/mt from April 3, an increase of 0.42%.

According to SMM, on the supply side of cobalt chloride, as smelters' early raw material inventories have been largely depleted and raw material prices remain high, smelters are unwilling to sell at low prices, with a strong sentiment to stand firm on quotes, keeping market prices at a high level with limited supply. On the demand side, although market activity is not high, some manufacturers still have to purchase cobalt chloride to maintain normal production, driving high-level transactions and thus pushing spot prices slightly higher.

Next week, cobalt chloride prices are expected to remain high, with suppliers showing a strong reluctance to sell.

Co3O4: According to SMM spot price data, Co3O4 spot prices showed a downward trend this week. As of April 11, Co3O4 spot prices fell to 203,000-218,000 yuan/mt, with an average price of 210,500 yuan/mt, down 750 yuan/mt from April 3, a drop of 0.36%.

According to SMM, on the supply side, most smelters' quotes remain stable, and the market is gradually returning to rationality. On the demand side, as most manufacturers have completed their earlier purchases, new orders this week are limited, reducing market acceptance of high prices and weakening transaction activity, with the market entering a buffer period.

Next week, downstream LCO manufacturers' purchase willingness is not strong, and Co3O4 spot prices may further decline.

On the news front, according to an announcement released by CMOC on the evening of April 8 regarding its January-March 2025 operations, the company seized favorable market opportunities to stabilize and increase production. The company's main products, copper, cobalt, and niobium, saw production increases of 15.65%, 20.68%, and 4.39% YoY, respectively. Benefiting from YoY increases in the selling prices of all products, the company's main operating indicators exceeded expectations, achieving a good start to the year. According to its annual report data, in 2024, the company's production of copper, cobalt, niobium, and phosphate fertiliser all hit record highs. In 2024, CMOC produced 114,200 mt of cobalt. In 2025, the company plans to produce 600,000-660,000 mt of copper, 100,000-120,000 mt of cobalt, and 12,000-15,000 mt of molybdenum.

On April 9, Pengxin Resources disclosed its Q1 performance forecast, stating that preliminary calculations by the finance department show that the company expects to achieve a net profit attributable to the parent company of 100-130 million yuan in Q1 2025, an increase of 71.9033-101.9033 million yuan compared to the same period last year.

Regarding the reasons for the profit, Pengxin Resources stated that during the reporting period, the company's production and sales of products such as copper cathode increased, and the price of cobalt hydroxide rebounded, with the reversal of impairment provisions for existing cobalt hydroxide inventory from previous years.