Sellers of spot copper cathode cut offers on the morning of Friday May 8 as they were keen to cash in while a further rally in copper futures sidelined downstream consumers. 

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. 

Domestic demand for raw materials increased following the return of cobalt salt producers in March, and this led to the rebound in imports. It is understood that cobalt raw materials delivery to smelters resumed at the beginning of March and more than 80% of producers restarted operations by end-March. 

Northwest China’s Gansu province is mulling a plan to encourage local companies to stockpile up to 436,000 mt of nonferrous metals for at least seven months to support the market which has been hit by the COVID-19 pandemic crisis.

Demand for Chinese lithium cobalt oxide (LCO), a type of cathode material used to produce lithium batteries, could fall 40% in May, SMM estimates. This is against the backdrop of the coronavirus crisis overseas, which has led to steep declines in China’s export orders and prompted domestic smartphone makers to mull output cut.

Stringent coronavirus containment measures imposed by world authorities in March began to take their toll on supply of imported copper scrap in China, which accounts for about 60% of copper scrap consumption in the country, showed the latest SMM survey.

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.  

Chinese silicon plants may face difficulties to resume production as scheduled in the wet season starting from June as the global widespread COVID-19 has disrupted the supply chain and led to a shortage of raw material wood charcoal. SMM learned that most silicon plants have conducted maintenance and tried to secure feedstock for the preparation of resumption.

The state-owned China Southern Power Grid company has planned to accelerate its investment in new energy vehicle charging facilities in the coming years, as part of the move to develop "new infrastructure" projects for boosting sustainable growth of the economy. 

Prices of battery-grade nickel sulphate, a raw material used to produce electric vehicle batteries, halted their decline that lasted for much of March, and edged higher as of March 30, as concerns about feedstock supply disruption intensified after Papua New Guinea banned vessels at ports to stop the spread of the COVID-19.