[SMM analysis] overseas alloy market demand has not yet recovered the price of electrolytic cobalt or will continue to decline.

Published: May 31, 2020 12:24

Save

SMM, May 31:

At present, the price of electrolytic cobalt in the overseas market is 14.75 U.S. dollars / lb, which is basically stable compared with the previous week, but there is still no transaction in the spot market. Due to the lack of full resumption of work in the overseas downstream superalloy industry and the weak market demand for electrolytic cobalt, it is expected that overseas cobalt prices will still have downward space in the later stage.

Europe and the United States are the main consumer markets for electrolytic cobalt. The annual consumption of cobalt in China is less than 10, 000 tons, while that in overseas markets is about 15000 tons. Affected by the new crown epidemic, overseas aerospace and other places that need to use a large number of alloy products have hardly been consumed in recent months, and the market demand for electrolytic cobalt has been greatly reduced. Although the European government has made great efforts to promote the resumption of factories, according to feedback from SMM customers, the operating rate of factories in Europe is still on the low side.

Although recently, the price of electrolytic cobalt in China has continued to rise to 25-260000 yuan / ton (about 14.1 murals US $14.7 / lb) and gradually stabilized, but in fact there are few purchases in the spot market. The rebound in domestic prices is mainly due to the inflow of some funds into the market, while the major large consumers have enough raw materials in the metal cobalt price of 22-230000 yuan / ton (about 12.4 Mel 13.0 U.S. dollars / lb), and the existing inventory can still support the use of about 2 Mel for 3 months.

At present, the price gap of electrolytic cobalt at home and abroad has narrowed, the import and export window has not been opened, and the downstream demand of both markets is weak, and prices are lack of support. The downstream construction of metal cobalt in overseas market is slow, but the upstream supply has been restored one after another. Some suppliers revealed that there are almost no downstream enquiries in the spot market, and there are no orders for spot quotations to only about $14.2 / lb, and overseas electrolytic cobalt prices are expected to fall by about $0.50 / lb in the short term.

Price Forecast Electrolytic Cobalt overseas Market

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

For any inquiries or for more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

2 hours ago

[SMM Cobalt Morning Meeting Summary] Expectations for demand recovery heat up, industry chain prices remain in a weak bargaining phase

The industry chain remained in a weak bargaining phase this week, with upstream players holding prices firm while downstream buyers pushed for lower prices. Overseas miners acquired low-priced intermediate products, providing some support to the price floor, but the psychological price gap between buyers and sellers remained wide, limiting actual transactions. The sulphate market came under pressure from low-priced deals outside China and lower costs, with downstream purchase willingness subdued as the market awaited the release of stockpiling demand during the September-October peak season. The powder market also consolidated at lows, with downstream cemented carbide orders weak and spot transactions sluggish. Ternary cathode precursors continued to weaken under soft raw material prices and pressure on order coefficients, while top-tier producers saw relatively better export orders. Ternary cathode materials staged a phased rebound as lithium chemical prices recovered, but domestic power demand was weaker than expected, leaving subsequent production schedules facing downward pressure. The supply-demand pattern for LCO showed limited improvement, with peak season effects yet to materialize clearly. On the policy front, measures to support automobile consumption continued to advance, which is expected to provide some support for end-use demand, but a genuine stabilization of the industry chain still hinges on downstream concentrated procurement and an improvement in actual demand.

2 hours ago

14 hours ago

[SMM Chromium Flash] Mantashe Orders Halt to Tailings Deposits at Samancor's Dikwena Chrome After Dam Collapse

South Africa's Department of Mineral and Petroleum Resources has instructed Samancor to stop depositing tailings at any of its dams at the Dikwena Chrome facility in Brits, North West, while an investigation continues into the August 13 collapse of a sidewall at the mine's Dam 1B tailings storage facility. The failure released the bulk of the dam's stored waste, damaging mine infrastructure, a railway line and Eskom power infrastructure, and sending sludge into a nearby wetland and toward the neighboring Eland Mine's Maroelabult shaft area. No injuries or fatalities were reported. Minister Gwede Mantashe, accompanied by Deputy Minister Phumzile Mgcina, Water and Sanitation Deputy Minister David Mahlobo and chief inspector of mines David Msiza, conducted a joint on-site and aerial oversight visit to the facility on August 17. Mantashe said the incident underscored that tailings dam management is a mining issue tied directly to operational and structural accountability rather than a water-management matter alone, and raised concern that Samancor had not decisively addressed seepage reportedly identified at the facility roughly three months before the collapse. Samancor has taken responsibility for the investigation, clean-up and rehabilitation, with CEO Desmond McManus confirming the company is repairing damaged electrical infrastructure and access roads and will appoint an independent professional to assess the facility. The Department of Water and Sanitation has deployed teams to conduct water quality sampling and environmental risk assessments, while Mahlobo said an aerial inspection indicated the spillage had been contained, though the facility's exact groundwater impact remains under review. The tailings facility is operated by contractor One Chrome, which also runs the site's Inyoni Platinum PGM recovery plant, and investigations into the technical and operational causes of the failure remain ongoing.

14 hours ago

16 hours ago

[SMM Chromium Flash] FAPA Warns SA Ferroalloys Sector Still Faces Rapid Decline Despite Ferrochrome Tariff Relief

South Africa's ferroalloys sector remains in a state of rapid decline despite recent electricity pricing relief for the ferrochrome industry, according to Ferro-Alloy Producers Association (FAPA) chairperson Nellis Bester. He said the tariff relief, credited with enabling the restart of Glencore Merafe's Boshoek and Wonderkop smelters earlier this year, has served mainly to prevent further deterioration rather than restore conditions for renewed growth, and should be treated as a short-term measure rather than a lasting fix. Bester attributed the sector's ongoing weakness to a combination of structural pressures: escalating electricity costs, rail and port logistics constraints, unprotected imports of finished alloy products, growing competition from lower-cost producing countries, and prolonged uncertainty over industrial policy. He said South Africa's silicon and manganese alloy operations are in a more precarious position than ferrochrome, with several smelters already suspended and others at risk of permanent closure, and warned that without decisive government and Eskom intervention within weeks, the decline would deepen and add to unemployment. Among the fixes Bester called for are a genuinely competitive electricity tariff, import duties on finished alloy goods, and improved rail and port infrastructure to reduce reliance on costlier road transport for exports. He stressed that South Africa retains world-class mineral resources, technical expertise and installed smelting capacity, but that these advantages are being eroded by structural cost disadvantages the industry says can still be corrected through coordinated action, adding that producers are not seeking permanent protection, only a fair, competitive operating environment to preserve the sector's remaining skilled jobs.

16 hours ago