YIBIN, Apr 29 (SMM) – Global inventories of cobalt raw materials are likely to see a buildup of 65,000 mt in metal content in 2016-2019, and stocks may only start to deplete in 2023, said Qin Jingjing, analyst from SMM. She expected oversupply to keep the average price of refined cobalt around 230,000 mt/yuan in 2019, after prices slid around 45% from highs at the end of 2018.
Supply of cobalt is likely to rise 11.6% year on year globally in 2019, to 179,000 mt in metal content, with a compound annual growth rate (CAGR) of 11% in 2018-2021, she told delegates at the SMM Nickel-Cobalt-Lithium-Manganese Summit on Monday April 29 in Yibin of Sichuan province.
The worldwide cobalt demand, however, is likely to increase 3.7% from 2018 to 139,000 mt in Co content, with a CAGR of 7% in 2018-2021. Qin added that lithium batteries are expected to account for 60% of the global demand for cobalt by 2021, up from 53% in 2018.
During May to August, stable consumption and gradual release of supply will grow pressure on refined cobalt prices and keep them at 190,000-250,000 yuan/mt. Peak-season demand from the digital market and higher consumption from power batteries may underpin cobalt prices at 180,000-190,000 yuan/mt in September to October. In November to December, cobalt producer will cut production as demand shrinks, and this may drive prices to a low of 170,000 yuan/mt, according to Qin.
China imported some 77,000 mt, in metal content, of cobalt raw materials in 2018, up 12% on the year, with cobalt ore taking up most of the increase. Qin sees the imports exceeding 83,000 mt in metal content in 2019.
She expected the global supply of lithium raw materials to reach 425,000 mt in lithium carbonate equivalent (LCE) this year, up 4% from 2018, with a CAGR of 8% in 2018-2021. Consumption of lithium raw materials is expected at 249,000 mt in LCE worldwide in 2019, with a CAGR of 16% in 2018-2021.
Lithium batteries are estimated to take up 70% of the demand in 2019, and the proportion may expand to 78% by 2021, Qin added.
China saw a glut of 93,000 mt lithium raw materials in 2018, as supplies registered 277,000 mt in LCE and consumption stood at 181,000 mt. Imports accounted for 82% of the supplies.