SMM4, January 1: the recent import of cobalt raw materials continues to attract market attention. This paper mainly introduces the import of cobalt raw materials in China in 2019. In this paper, cobalt ore and cobalt wet smelting intermediates are analyzed according to production and marketing countries, transit countries and transportation modes respectively for your reference (* Note: the import data of cobalt ore in this paper are converted according to 8% grade; the import data of cobalt wet smelting intermediates are converted according to 27% grade). In the short term, downstream demand is low, China has sufficient stocks of cobalt raw materials, and the main contradiction for the time being is when downstream demand will pick up; however, if an outbreak breaks out in Africa, the supply of cobalt raw materials will continue to be blocked, which may affect the prices of cobalt series products in June or even the second half of the year

Import of Cobalt Ore in China in 2019

China's cobalt mines will import about 10500 tons of metal tons in 2019, mainly from Africa. Cobalt imports from Africa in 2019 were about 9418 metal tons, accounting for about 89 per cent; from Asia, about 1126 metal tons, or 11 per cent; and from Oceania, 0.13 metal tons, almost negligible.

According to the production and marketing countries, China's cobalt ore imports mainly from the Democratic Republic of the Congo (gold). In 2019, cobalt mines imported about 6719 metal tons from the Democratic Republic of the Congo (DRC), accounting for about 63.723%; about 2191 metal tons, or 20.78%, from South Africa; about 1126 metal tons, or 10.677%, from China's bonded areas; about 356metal tons, or 3.381%, from the Democratic Republic of Congo; Zambia, about 102metal tons, accounting for 0.968%; Tanzania, about 49 metal tons, accounting for about 0.469%; Australia is about 0.13 metal tons, accounting for about 0.001%.

Proportion of countries importing and selling cobalt mines in China in 2019

Source: SMM, China Customs

According to the situation of transit countries, China's cobalt imports are mainly transported from South Africa. In 2019, China's cobalt mines transported about 5193 metal tons from South Africa, accounting for 49.9%; about 606 metal tons, or 5.8%, from Tanzania; and about 2832 metal tons, or 27.2%, in China bonded areas (including Hong Kong). According to customs data, about 1771 metal tons of cobalt mines were shipped out of Congo gold in 2019, accounting for about 17% of the total number of transit countries. Others are mainly transported from Australia and Zambia, with a negligible share. From the mode of transport, China's cobalt mine imports in 2019 mainly by water transport, accounting for about 73%; other transport and air transport about 27%.

The proportion of China's Cobalt Mine Import and transfer countries in 2019

Source: SMM, China Customs

Import of Intermediates in Cobalt Wet smelting in China in 2019

China imports about 113800 tons of metal tons from cobalt hydrometallurgy intermediates in 2019, mainly from Africa. In 2019, cobalt hydrometallurgical intermediates imported about 94700 tons of metal tons from Africa, accounting for about 83%; about 18300 tons of metal tons, or 16%, from Asia; about 600 tons of metal tons, or about 1%, from Europe; and 100 tons of metal tons, or about 0.1%, from Oceania.

According to the countries of production and marketing, the import of cobalt hydrometallurgical intermediates in China mainly comes from the Democratic Republic of the Congo (DRC). In 2019, cobalt intermediate imports from the Democratic Republic of the Congo (DRC) about 57400 tons of metal tons, accounting for about 50.42%; from South Africa, about 32200 tons of metal tons, accounting for about 28.29%; China bonded area (including Hong Kong) about 17400 tons of metal tons, accounting for about 15.28%; imports from Tanzania of about 4900 tons of metal tons, accounting for about 4.27%; About 900 tons of metal tons, or about 0.78 per cent, were imported from Malaysia, while others accounted for about 0.97 per cent.

Proportion of Import and Export countries of Cobalt Wet smelting Intermediates in China in 2019

Source: SMM, China Customs

According to the situation of transit countries, the import of cobalt intermediates from China is mainly transported from South Africa. In 2019, Chinese cobalt intermediates shipped about 52400 tons of metal tons from South Africa, accounting for about 60.19%; about 7600 tons of metal tons, or 8.7%, from Tanzania; and about 2.48 tons of metal tons, or 28.41%, in the China bonded area (including Hong Kong). According to customs data, about 300 tons of cobalt intermediates were shipped out of Congo gold in 2019, accounting for about 0.36% of the total. About 1600 tons of metal tons, or 1.82 per cent, were transported from Malaysia, about 200 tons, or 0.18 per cent, from the Russian Federation, and about 300 tons, or 0.35 per cent, from other countries. In terms of mode of transport, in 2019, China's cobalt intermediate imports mainly rely on water transport, accounting for about 82%; other transport and air transport about 18%.

Proportion of Cobalt Intermediate Import countries in China in 2019

Source: SMM, China Customs

Number of new crowns confirmed and related policies in major African countries as of 20200401

Source: official bulletin and media of SMM, countries.

At present, on the cobalt raw material supply side, it is understood that Vale announced a reduction in mining operations at the (Voisey's Bay) mining area in Voith Bay, Canada, on 16 March, and that Vale Voith Bay cobalt raw material production in 2019 is about 1400 tons of metal tons, accounting for about 0.78 per cent of the global cobalt raw material supply.

Cobalt raw material logistics is greatly affected by the epidemic situation. According to SMM, due to the national blockade in South Africa, the shipping dates originally scheduled for April 6 and April 16 have been postponed, and efforts are being made to coordinate logistics operators to consult the latest shipping schedule. South Africa's state logistics company Transnet said that it will reduce transport services and unnecessary freight operations during the national embargo on coronavirus containment, which begins at midnight on April 2. The company said the transport of metals and minerals would depend on demand and government approval. The government had previously asked Transnet to stop freight rail and maritime transport of basic and necessary materials completely; Zambia's transport has been blocked and can now be negotiated, but the number of personnel has been reduced and the efficiency of logistics has been reduced. As a result, the current basic situation in Africa is a slowdown in logistics, mainly focused on the hindrance of inland logistics; according to customer feedback, ports and logistics are temporarily negotiable and have not been completely blocked. Mining enterprises and cobalt raw materials traders in addition to long orders, the current basic foreign quotation, do not sign new orders, the main epidemic situation in Africa has not yet been determined, the ship arrangement is unknown.

Affected by the African epidemic is expected to affect the import of raw materials, according to SMM research, this week's major cobalt mining enterprises and domestic mainstream cobalt salt manufacturers intend to "raise prices", mainly affecting the market mood. According to the results of the current research, according to the current operating rate, it is speculated that domestic cobalt raw materials (including stocks of cobalt salt plant raw materials, bonded areas and raw materials that have been shipped at sea in March) are basically sufficient until the end of May; considering the continuing downturn in downstream demand, cobalt raw materials may be available for a longer period of time. SMM believes that the main contradiction is still focused on the limited terminal demand, the basic attitude of the cobalt salt plant this week is the same, but the downstream demand is difficult, cobalt salt plants accumulate more and more, do not rule out some smelters due to cash flow problems to sell goods at low prices. If the epidemic situation in South Africa is not effectively controlled after April 16, the overall logistics is blocked, and the epidemic situation in Africa is serious, which will affect the import of cobalt raw materials and the price of cobalt series products in June or even the second half of the year. SMM will continue to pay attention to the epidemic in Africa and cobalt raw materials, logistics, port control.

SMM cobalt lithium new energy research team

Hu Yan 021-51666809

Qin Jingjing 021-51666828

Mei Wangqin 021-51666759

Huo Yuan 021-51666898

Wuyang 021-51666818