[2019.07.01 minutes of internal morning meeting of cobalt-lithium new energy] the downturn of battery terminals continues to worsen the bearish upstream of cobalt and lithium.

SMM, July 1 / PRNewswire-Asianet /-

Battery Terminal Market:

Power battery demand continues to be depressed, according to SMM, a leading battery factory in order to optimize the product structure, require its mainstream suppliers to upgrade the production line, this will affect its overall production of power batteries in the third quarter, and directly pull up the inventory level of upstream positive material manufacturers. SMM expects power battery production to continue to decline in July as it enters the industry's traditional off-season, but by a slower rate. The downturn is likely to continue until the end of the third quarter.

Upstream raw material price:

Cobalt: this week the foreign media prices continue to decline, the big factory quotation is strong, intends to wait for the foreign media price to fall to the same level in China and then adjust the quotation according to the market situation. Although the downstream buyer has a wait-and-see mentality, but at the end of the month, this week a small number of prices due to rigid demand, trading prices fell slightly. In the aspect of cobalt hydroxide, the seller's inventory pressure is greater, the shipping mentality is positive, the buyer's finished product sales price continues to decline, the purchase is particularly cautious, the psychological price is low, the transaction price drops. SMM expects cobalt salt prices to gradually stabilize and high premium metals such as cobalt and tetra cobalt to move closer to cobalt salt prices.

Lithium: lithium carbonate and lithium hydroxide are affected by a sharp drop in orders from downstream material manufacturers, and prices continue to fall. For small and medium-sized lithium carbonate production enterprises, due to fear that the future price will continue to fall, there has been a low price for the return of goods behavior. In order to cope with the rapid changes in industry demand, some manufacturers have also begun to reduce production. We expect the downturn to continue until the end of the third quarter and that the premium for battery-grade lithium carbonate and battery-grade lithium hydroxide will continue to narrow.

News: at 05:18 on June 24, Mou Ke, general manager of Ya'an Lithium Industry of Yahua Group, pressed the ignition button and burned flames in the rotary kiln. Ya'an Lithium Industry produced 20,000 tons of battery-grade lithium carbonate (lithium hydroxide) production line to achieve one-off successful ignition. Ya'an lithium industry "annual output of 20, 000 tons of battery-grade lithium carbonate (lithium hydroxide) production line" construction project was officially launched in May 2018, with a total investment of about 790 million yuan.

SMM Cobalt Lithium Research team

Hong Lu 021 51666814

Ning Ziwei 021 51666780

Qin Jingjing 021 51666828