Global Cobalt Oversupply to Ease in 2017, and High Chance to See Shortages in 2018, SMM Foresees

Published: Apr 13, 2017 17:47

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In 2017, the global cobalt supply is expected to ease and there is high chance to see supply shortage in 2018, SMM predicts at SMM 2nd Cathode Material Conference held on Apr. 7-8.

SHANGHAI, Apr. 13 (SMM) – In 2017, the global cobalt supply is expected to ease and there is high chance to see supply shortage in 2018, SMM predicts at SMM 2nd Cathode Material Conference held on Apr. 7-8.

At present, output growth at world’s main cobalt ore mines is small, and meanwhile, output of cobalt sulfide ore (Co 3-20%) is down significantly.

Cobalt to Get Back to Fundamentals after Speculative Surges, SMM Reports

Taking Mutanda mine as an example, its output grew sharply in 2016 thanks to higher grade and completion of project upgrading, which will leave small room for output growth in the coming years for Mutanda and other large mines, which also face similar conditions. In Congo, unstable political condition will significantly hit production of cobalt sulfide ore (Co 3-20%).

In the global market, ore supply from mines is expected to fall by 1.4 percent in 2017 on a yearly basis following a sharp decline in output of cobalt sulfide ore (Co 3-20%) in Congo. With production resumption at Katange and output increase, global cobalt supply is expected to return to grow in 2018.

The battery sector will become a major driver for cobalt demand for the foreseeable future, SMM foresees at the conference. Of those, cobalt demand from 3C industry will be big and robust, while that from motive-battery is relatively not high, but a quick growth one.

In 2017, under neutral estimation, the global cobalt supply surplus is expected to narrow sharply to 5,000 mt, and in 2018, the growth of supply will be far below that of demand, which will create supply shortages. Under optimistic outlook, the surplus will narrow to 4,300 mt in 2017, and enter into the shortage in 2018, and the shortfall to expand in 2019. In conclusion, there is low chance to see supply shortage in 2017, but a high one for shortage in 2018.

SMM Interview: Cobalt & Lithium and Motive Battery Market Outlook

What will be new trends in the motive battery sector?

With Chinese government’s emphasis on energy density of battery, the development trend of motive battery sector will also focus on this, and high-nickel ternary materials will accelerate the industrialization process of the sector. Moreover, battery with new materials is coming to the fore, and the traditional automotive battery system, mainly dominated by Li-ion battery, will likely be more diversified with new type batteries involved in, such as solid-state battery and fuel cell in the future.

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Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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