Prices of cobalt products are expected to continue to moderate in the near term with the arrival of seaborne cobalt raw materials and the continued weak demand for cobalt sulphate.

Prices of cobalt are expected to further retreat this week as the arrival of cheap cobalt raw materials impacts the domestic spot market and grow cobalt salt producers inclination to destock. 

Trades in the cobalt market remained muted as concerns about tight raw materials supply have faded. Cobalt prices may again retreat with the arrival of seaborne cobalt raw materials at end-June. 

Prices of cobalt rebounded last week, but the possibility of a sustained price rally is limited given the continued weakness in the new energy vehicle (NEV) market. Spot cobalt transactions were light last week as large-scale producers of high-temperature alloy and magnetic materials had sufficient stockpiles of cobalt raw materials. 

The China Solid Waste and Chemicals Management Bureau, a unit of the Ministry of Ecology and Environment, granted import allowances for 10,423 mt of high-grade copper scrap to 14 companies in the latest release, bringing the cumulative quotas for this year to 540,184 mt.

Jiangsu Tafel New Energy Technology on May 17 kicked off construction of its phase II and III capacity of a power battery project, which is located at the Jiangning Development Zone, Nanjing.  

Prices of most light and medium-to-heavy rare earth oxides increased last week as sellers firmed up offers on active enquiries by downstream consumers. SMM expects the improvement in enquiries to continue to support prices of medium-to-heavy rare earth oxides this week, while prices of light rare earth, such as praseodymium-neodymium oxide, will likely pull back as the strength of demand may unable to sustain a price rally. 

Prices of cobalt and lithium products may continue to face some downward pressure as demand from overseas consumers remains weak and the domestic market is cautious about restocking. 

Several cobalt salt producers in China, including a leading firm, plan to scale back operations in May, SMM learned, as downstream sectors are cutting output with the COVID-19 crisis battering global economies, and also due to high costs and raw material supply disruptions.

Demand remained subdued in China’s cobalt market last week while a handful of consumers purchased as required. The market may find some near-term support from the extended national lockdown of South Africa, which will last until end April and aim to curb the COVID-19 pandemic.