[SMM Cobalt Lithium spot Weekly] Power market operating rate maintains low raw material inventory pressure increase (0407-0410)

SMM, 10 April:

Battery and downstream end markets:

In terms of power batteries, new energy vehicle production and sales data and power battery production data were released this week. According to the China Automobile Association, the production and sale of new energy vehicles (excluding Tesla) completed 50000 and 53000 respectively in March, down 56.9 per cent and 53.2 per cent respectively from the same period last year. From January to March, the production and sale of new energy vehicles reached 105000 and 114000 respectively, down 60.2 per cent and 56.4 per cent respectively from the same period last year. Affected by the global epidemic, the production and sales of new energy vehicles in the first quarter is not good, but month-on-month, production and sales in March is significantly higher than in February, the domestic new energy market is gradually recovering.

China's power battery production totaled 4.5 GWH in March, down 45.5% from a year earlier and up 396.6% from a month earlier, according to the China Automotive Power Battery Industry Innovation Alliance. Among them, the output of ternary batteries was 3.2 GHz, accounting for 72.4% of the total output, down 40.9% from the same period last year, up 600.5% from the same period last year, while the output of lithium iron phosphate batteries accounted for 27.6% of the total output, down 50.6% from the same period last year, and 181.3% longer than the previous month. With the improvement of the domestic epidemic situation, the operating rate of battery plants gradually recovered, and the output of power batteries in March was significantly higher than that in January and February.

According to SMM, power ternary orders decreased significantly in late March, and some power battery factories gradually converted material inventory into battery inventory. At present, the willingness of domestic terminal consumption has recovered slowly, the overseas epidemic has not been effectively controlled, battery exports are still affected, and the inflection point of demand still needs to pay attention to the situation of overseas epidemic control and the detailed rules of domestic subsidy policy.

Electrolytic cobalt and cobalt hydroxide: electrolytic cobalt prices fell this week. China's metal cobalt market prices fell slowly this week, although a few large producers are willing to bid, but only part of the spot market just need to purchase, transactions sporadic, prices under pressure to decline. Demand for cobalt in overseas markets remained weak, domestic export orders fell and foreign media cobalt prices continued to decline. Cobalt hydroxide, although South Africa may not be able to resume port transport as scheduled, but the Chinese smelter raw material inventory is relatively sufficient, superimposed downstream battery market demand is weak, crude cobalt hydroxide is not traded, the price is stable. The price of SMM electrolytic cobalt is 23.7-255000 yuan / ton, down 5000 yuan / ton compared with last week. The price of cobalt hydroxide in SMM is $9.8-$10.6 per pound, the average price is the same as last week.

Cobalt and nickel salts: cobalt salt prices fell this week. Demand for cobalt salt downstream increased a little this week, some cobalt tetroxide, ternary precursor plant purchase cobalt sulfate, cobalt chloride, trading volume is still small. Downstream demand continues to be depressed, a small amount of cobalt salt plant funds under pressure, mainly at low cash prices. South Africa continued to extend the "closed country" news on Friday, short-term support for the market, but low demand is still not a major factor, next week still does not rule out a small number of low-price shipments of cobalt salt plants. The price of cobalt sulfate in SMM is 4.4-47000 yuan / ton, down 500 yuan / ton from last week. The current price of SMM cobalt chloride is 5.3-56000 yuan / ton, down 2000 yuan / ton from last week. The price of nickel sulfate of SMM battery grade is 23000-23500 yuan / ton, which is 250 yuan / ton higher than that of last week.

Cobalt tetroxide: the price of cobalt oxide fell on Thursday. The volume of cobalt oxide increased slightly on Thursday, and the willingness of cobalt oxide manufacturers to ship increased, but the downstream price pressure is more serious, but the demand has not yet been fully met. Next week or new orders will continue to increase, the buyer's market is strong, and prices may continue to fall. The current price of SMM cobalt oxide is 17.5-180000 yuan / ton, down 5000 yuan / ton from last week.

Ternary precursor: the price of the body fell before the yuan on Wednesday. The price of cobalt sulfate fell slightly upstream this week, and the price of the precursor fell accordingly. Demand in the downstream power market has not picked up, orders in the digital market have decreased, material factories have pressed prices seriously, and precursor manufacturers have been forced to ship goods at reduced prices. At present, the order volume in the power market is sporadic, the supply in the consumer market exceeds demand, the precursor price basically approaches the cost line, and the room for price decline is limited. The price of SMM ternary precursor (type 523) is 7.4-76000 yuan / ton, down 500 yuan / ton compared with last week. The price of SMM ternary precursor (622) is 8-83000 yuan / ton, the average price is the same as last week.

Lithium carbonate: industrial grade lithium carbonate fell slightly this week. On the supply side, in addition to Qinghai and Sichuan this week a large factory began to enter the maintenance phase, there is no more news of production cuts. On the demand side, a number of 3c terminal factories in Southeast Asia announced the suspension of production in mid-to late March, affecting domestic digital export orders; power terminal consumption recovered slowly, battery companies began to postpone or cancel material orders in mid-to late March, choosing to digest material stocks first. Multiple factors have led to sporadic orders for battery grade lithium carbonate, industrial grade lithium carbonate orders have declined, and lithium carbonate prices are still under pressure. This week, the price of lithium carbonate in SMM battery grade is 4.5-48500 yuan / ton, the average price is the same as last week. This week, the price of SMM industrial grade zero lithium carbonate is 3.75-41000 yuan / ton, down 250 yuan / ton compared with last week.

Lithium hydroxide: the price of lithium hydroxide is flat this week. Export orders for lithium hydroxide remained stable. Domestic lithium hydroxide demand market is mainly LG industrial chain and Ningde era industrial chain, Tesla Shanghai plant capacity has gradually climbed to full production, some domestic high nickel orders delayed, material end slightly reduced production. High-quality lithium hydroxide shipment is still tight, the price is stable; the rest of the lithium hydroxide supplier operating rate recovery at the same time the order is limited, low price or some pressure space. This week, the price of SMM battery grade lithium hydroxide (coarse particles) is 5.3-59000 yuan / ton, the average price is the same as last week.

Lithium cobalt: the price of lithium cobalt has fallen this week. This week, downstream demand for lithium cobalt is still in the doldrums, upstream cobalt salt, cobalt oxide prices fell, this week lithium cobalt quotation also fell slightly, transactions sporadic. The price of lithium cobalt sulfate in SMM4.35V is 20.8-212000 yuan / ton, down 2500 yuan / ton from last week.

Ternary materials: the price of ternary materials fell this week. The price of the upstream precursor continued to decline, and the Sanyuan material factory reduced the price accordingly. Power battery plants had larger inventories and lower purchases in April, while a large number of overseas export orders in the digital market were cancelled or delayed, and demand for ternary materials also fell. The price of SMM ternary material (type 523) is 11.9-125000 yuan / ton, down 1500 yuan / ton compared with last week. The price of SMM ternary material (622) is 13.6-142000 yuan / ton, down 5000 yuan / ton compared with last week.

Lithium iron phosphate: the price of lithium iron phosphate is down this week from last week. Lithium carbonate prices fell this week, downstream power market orders are still sporadic, energy storage market orders have increased slightly, battery factories on iron lithium enterprises seriously, iron lithium prices fell slightly. This week SMM lithium iron phosphate (power) price is 3.8-42000 yuan / ton, the average price is down 750 yuan / ton from last week.

Lithium manganate: the price of lithium manganate is flat this week compared with last week. Lithium carbonate prices fell slightly this week, downstream consumer orders in overseas markets fell sharply, lithium manganate purchases fell accordingly. The order of dynamic lithium manganate is sporadic, and the price has not changed. The current price of volumetric lithium manganate is near the cost line, so it is difficult for lithium manganate manufacturers to reduce the price. This week SMM lithium manganate (volume) price is 2.15-30500 yuan / ton, the average price is the same as last week. This week, the price of SMM lithium manganate (power type) is 3.45-36500 yuan / ton, the average price is the same as last week.

Future forecast:

Cobalt, a small amount of procurement this week, overall demand remained low, South Africa continued to extend the "closed country" news, short-term to play a little supporting role in the market. On the lithium side, while demand is weakening, lithium carbonate supply is still increasing and industry inventory pressure is surging. Future demand is still the dominant factor in the market, the market may have a small number of low-price shipping behavior. According to SMM, irrational production behavior lasts for a limited period of time, and lithium salt may enter the stage of passive production reduction in the second quarter.

SMM Battery Materials Research team

Hu Yan 021-51666809

Qin Jingjing 021-51666828

Mei Wangqin 021-51666759

Huo Yuan 021-51666898

Wuyang 021-51666818