Amid intensifying global competition in the new energy sector, Toyota Tsusho Corporation has announced the acquisition of a 25% stake in LG-HY BCM Co., Ltd., marking a pivotal move in securing its position within the electric vehicle (EV) battery supply chain. This investment reflects Japan’s accelerating push into core materials and underscores the growing importance of upstream resource control and regional supply chain security.

Cost Push from LCO May Dominate the Future Market

This week, nickel sulphate prices remained basically flat, while cobalt sulphate prices continued to rise, and prices of salt products such as lithium carbonate continued to decline. Despite the sustained increase in cobalt salt prices, the nickel and cobalt coefficients for ternary and LCO black mass remained basically flat WoW, while the lithium coefficient followed the decline in lithium carbonate prices. The price per % lithium for LFP black mass continued to decrease this week. Taking LFP pole piece black mass as an example, the current price range is 2,600–2,800 yuan/mtu, down approximately 100 yuan/mtu WoW. For ternary black mass, the nickel and cobalt coefficient for ternary pole piece black mass currently stands at 73–75%, flat WoW, while the lithium coefficient is 68–71%, also basically unchanged from the previous week. For LCO black mass, the cobalt coefficient increased by 1 percentage point this week, while the lithium coefficient decreased by 2 percentage points. On the LFP hydrometallurgy side, most LFP battery hydrometallurgy recycling plants maintained toll processing. With the decline in lithium carbonate prices this week, the profit margin for externally purchasing LFP black mass to produce lithium chemicals gradually shifted from hovering around the breakeven point at the end of August to approximately -5% to -8%. As a result, some lithium chemical recycling enterprises that resumed production in mid-August adopted a cautious attitude toward purchasing raw materials such as black mass, and market sentiment was mediocre compared to the previous week.

Co3O4: Price Transmission Lags, Rise Expectations Strengthen

Cobalt Chloride: Cost-Driven Price Breakthrough

This week, domestic spot prices of refined cobalt fluctuated upward, but overall market trading activity saw limited changes compared to last week. Supply side, major smelters maintained long-term contract supplies, while traders quoted prices following futures movements. Demand side, downstream enterprises showed low acceptance of the current high cobalt prices, with procurement primarily driven by rigid demand, leading to sluggish actual market transactions. The price increase of refined cobalt this week was mainly driven by the continuous rise in prices of cobalt intermediate products and cobalt salts. However, its relatively high inventory levels and weak demand continued to exert some suppression on the price uptrend. Going forward, close attention should be paid to the price spread between refined cobalt and cobalt salts, particularly monitoring when refined cobalt might be reverse-processed into cobalt salts.

Market data this week showed that on the supply side, influenced by fluctuations in lithium carbonate and cathode material prices, prices of new battery cells were the first to rise. Meanwhile, with the arrival of the September-October peak season for auto sales, the inventory-to-sales ratio of enterprise battery cells declined, and production increased simultaneously. This trend further extended to the secondary and recycling sectors. Previously, the continuous decline in lithium carbonate prices had strengthened enterprises' reluctance to budge on prices, with some hoarding goods. Currently, as demand in the secondary and recycling markets remains stable, some popular models in the market have ended up in a situation where prices are quoted but no actual transactions occur.

Spot cobalt sulphate prices rose further this week. Supply side, smelters and traders raised their quotation ranges daily, with cobalt intermediate products currently quoted by smelters at 57,000–59,000 yuan/mt, while MHP, recyclers, and traders gradually raised their offers to 56,000 yuan/mt. Demand side, downstream enterprises remain in the traditional peak season, with some still restocking, but since the latter half of last week, sustained price increases for cobalt salts have begun to dampen buyer sentiment, with the highest acceptable price currently concentrated around 55,000 yuan/mt. Supported by rising raw material costs and seasonal restocking demand, cobalt sulphate prices are expected to hold up well in the short term. However, the extent of further price increases will depend closely on downstream enterprises' acceptance of sustained cobalt salt price rises; if price transmission is hindered, it may limit upside room.

Spot prices for cobalt intermediate products continued their upward trend this week. In the domestic market, a small volume of transactions for mainstream brands were concluded at $14/lb, and some enterprises reported potential transactions in the range of $14.1–$14.3/lb. Supply side, major miners halted offers and suspended quotations, and traders followed suit by temporarily withholding quotes. Demand side, under high cost pressure, smelters maintained only rigid procurement pace. Recent market performance indicates that high-priced intermediate products have significantly dampened downstream purchase willingness, with some enterprises turning to cobalt salt as a substitute for intermediate products to alleviate cost pressure. Overall, affected by the DRC's extension policy, China's cobalt intermediate products will continue to face raw material shortages, with upward momentum in prices, but attention should be paid to the inhibitory effect of rising raw material prices on downstream demand during this process.