SMM Salt Prices as Benchmark to Value Lithium Battery Scrap are Accepted by More Enterprises

SHANGHAI, Dec 21 (SMM) - Recently, many lithium battery recycling giants such as Zhejiang New Era Zhongneng Recycling Technology Co., Ltd. (New Era Zhongneng) and Jiangxi Ruida New Energy Technology Co., Ltd. (Jiangxi Ruida) announced that their prices of pure metals (namely refined cobalt, refined nickel and lithium metal) will be calculated based on the SMM prices of salt products (namely cobalt sulphate, nickel sulphate, lithium carbonate).

Taking SMM price as the benchmark is a milestone for the standardisation of the industry 

Since the beginning of 2022, the lithium battery recycling sector has seen an unprecedented boom with the rapid growth of lithium salt prices. Therefore, the problems related to pricing gradually stood out. One of the problems is down to the benchmark price. In the nickel market, the nickel metal prices and nickel salt prices became weakly correlated in the wake of the soaring nickel prices this March. In the cobalt market, the cobalt sulphate prices slumped due to the weak demand from electronics and power battery sectors, but the cobalt metal prices still stood high. The huge price gap between metals and their salts resulted in persistent losses of lithium battery recyclers. As a result, many smelters were struggling to survive. On the other hand, the metal prices were susceptible to many uncertainties such as futures prices and market sentiment. Therefore, they are not qualified to serve as the benchmark price in the lithium battery recycling sector.

Top-tier lithium battery recyclers will lead new pricing scheme

Previously, many lithium battery recycling companies explored different pricing models to alleviate their losses and the results varied. However, this time the top-tier recyclers including New Era Zhongneng and Jiangxi Ruida simultaneously chose SMM price as a new benchmark price, and this practice will set an example for the industry to seek feasible standard.

There is no doubt that the new benchmark price will be adopted by more companies. For the convenience of our customers to refer to SMM prices of salt products, SMM already introduces the free-of-charge "SMM Scrap Price Calculator" that will perform based on SMM prices of salt products. SMM believes that with joint efforts, the problems of non-standard benchmark prices in the lithium battery recycling industry will be gradually solved. SMM will keep track of the latest development in the market.