SMM Analysis On China September Cobalt Sulphate & Co3O4 Production And October Forecast

Cobalt Sulphate

In September, China's cobalt sulphate production decreased by 2% MoM and 28% YoY. The main reasons for the production decline in September were high spot inventory levels and downstream demand focusing on integration, leading to minimal spot demand. Some smelters, under inventory and cost pressures, chose to reduce production, resulting in an overall production decline. It is expected that in October, downstream demand will show further signs of weakening, so cobalt sulphate production may continue to decline.

Co3O4

In September, China's Co3O4 production increased slightly both MoM and YoY. The main reason for the production increase in September was the boost from Huawei's new models, leading to an increase in LCO enterprises' production schedules, which in turn drove up demand for Co3O4, mainly among top-tier enterprises. On the other hand, with the National Day holiday approaching, some companies arranged production in advance to cope with the holiday, boosting Co3O4 production schedules. It is expected that in October, downstream LCO market demand will become mediocre, with low purchase willingness for Co3O4, leading to a MoM production decline and limited YoY growth.