【SMM Cobalt and Lithium Morning Meeting Summary】Top-Tier Enterprises See Reduced Order Volume, LFP Material Plants' Production Falls Short of Expectations

Lithium Ore:

This week, spodumene prices continued to decline WoW. With the downward trend of lithium carbonate prices, downstream pressure on prices intensified. Some stockpilers sold off inventory to raise funds, with transaction prices ranging from $810-850/mt CIF, and the lower end of the range shifted downward WoW. Additionally, some domestic traders used futures market pricing for lithium carbonate to sell, further contributing to the decline in spodumene concentrate market prices. On the domestic spot ore side, suppliers' firm stance on quotes loosened amid pessimistic expectations for future lithium chemical prices, leading to a decline in transaction prices.
Lepidolite: Despite upstream suppliers' continued firm stance on quotes, downstream smelters' willingness to purchase at current high prices remains weak in the face of declining lithium carbonate prices, forcing market prices to move lower. Lithium Carbonate: The price center of spot lithium carbonate transaction prices remained stable WoW, showing a rangebound fluctuation during the week. From this week's market transactions, the majority of deals were between traders and downstream material plants. Upstream lithium chemical plants continued to stand firm on quotes, with weak willingness to sell. Traders, in order to clear some old inventory, promoted transactions with downstream material plants at relatively low price points. Overall, although spot lithium carbonate prices did not show a significant downward trend this week, market transactions weakened WoW. However, due to some material plants' just-in-time procurement needs, the spot market remained relatively active. In terms of weekly lithium carbonate production, output has decreased for three consecutive weeks. The continuous price decline has weakened the production enthusiasm of some upstream lithium chemical plants, and it is expected that lithium carbonate output in April may see limited or no increase. Considering the supply-demand situation, the surplus pattern of lithium carbonate is difficult to reverse. Coupled with the current loosening and declining trend in ore prices, it is difficult to provide strong support for the cost side of lithium carbonate. It is expected that spot lithium carbonate prices will still have some downside room. Lithium Hydroxide: This week, lithium hydroxide prices continued the previous slow decline trend. On the demand side, some ternary material plants, at the month-end/quarter-end period, have actions to negotiate and price orders for the new cycle, with moves to push down price discounts. Upstream lithium chemical plants, with strong cost support, have a clear stance on discounts and spot orders. Currently, there is little demand for large spot purchases in the ternary material sector, and the price for some spot purchases continues to move lower, driving the overall market price downward. The expected slow demand growth, combined with the drag from declining lithium carbonate prices, will continue the current slow decline trend in lithium hydroxide prices. Refined Cobalt: Spot refined cobalt prices rose slightly this week. On the supply side, smelters continued to stand firm on quotes. On the demand side, downstream producers' monthly procurement was basically completed, and market inquiries and buying were still slightly weak, but traders' trading enthusiasm improved WoW. In the short term, it is expected that market supply and demand will hardly change, and spot refined cobalt prices may maintain a fluctuating trend. Intermediate Products: Spot cobalt intermediate product prices rose slightly this week. On the supply side, the logistics channel from South Africa to Chinese ports remained smooth, but the supply tightening pressure caused by the DRC's suspension of cobalt exports continued to release. Upstream producers' spot quotes remained high, and the market's available supply was still insufficient. Downstream producers maintained rigid inquiries, and the price spread imbalance led to difficult volume transactions. It is expected that next week, spot cobalt intermediate product prices may fluctuate upward. Cobalt Salts (Cobalt Sulphate and Cobalt Chloride): Spot cobalt sulphate prices rose slightly this week. On the supply side, upstream salt plants' quotes were basically flat WoW and continued the firm quote strategy, with some salt plants releasing small batches of supply. Downstream enterprises' concentrated procurement has ended, and current inquiries and buying are weak. The expected transaction price spread still exists, and market liquidity has not significantly improved. In the short term, the market may continue a "weak balance" fluctuating trend, and spot prices may fluctuate upward. This week, cobalt chloride prices showed a slight rebound. On the supply side, the market is gradually becoming rational, and cobalt chloride producers no longer insist on not selling, with increased willingness to sell. On the demand side, the main purchasers of Co3O4 still maintain a wait-and-see attitude. Although the number of inquiries increased, actual transaction volume remained limited. Looking ahead, the market will still be affected by the cobalt export ban, and panic sentiment may persist. Some producers may choose to maintain current prices and adopt a strategy of holding back sales, which may lead to further price increases in cobalt chloride. Cobalt Salts (Co3O4): This week, Co3O4 prices showed a slight pullback. On the supply side, most smelters' quotes tended to stabilize, and the market gradually returned to rationality. On the demand side, most producers had completed procurement earlier, so new orders this week were few, and market acceptance of high prices decreased, with activity weakening, entering a buffer period. In the short term, Co3O4 prices are expected to remain at relatively high levels, but due to weak willingness of downstream LCO producers to purchase and some resistance sentiment, prices may continue to decline next week. Nickel Sulphate: As of Thursday this week, the SMM battery-grade nickel sulphate index price was 28,023 yuan/mt, with the battery-grade nickel sulphate quotation range at 27,970-28,550 yuan/mt, and the average price rose WoW. On the supply side, due to limited acceptance of MHP prices by nickel salt plants, some nickel salt plants have cut production, leading to relatively limited supply of nickel sulphate in the market. Tight supply in the nickel salt market has prompted nickel salt plants to stand firm on quotes. On the demand side, during March, precursor plants mainly met production needs through destocking, and their inventory has now dropped to a low level, with strong demand for restocking nickel salt. This week, precursor plants' acceptance of spot nickel sulphate prices also improved. Some precursor plants have started negotiating long-term contracts for Q2, but due to the recent firm stance of nickel salt plants on quotes, Q2 contract negotiations are ongoing with a game situation. Overall, given the tight supply in the nickel salt market and the firm stance of salt plants, it is expected that nickel sulphate prices will continue to rise next week. Ternary Cathode Precursor: This week, the ternary cathode precursor market remained firm, with prices of 5-series for consumer electronics, 6-series for consumer electronics, and 8-series for NEV showing little fluctuation. In terms of raw material costs, nickel sulphate and manganese sulphate prices rose slightly, while cobalt sulphate, affected by the DRC's cobalt export ban and market sentiment disturbances, showed short-term fluctuations, driving prices of various series precursors to rise slightly to varying degrees. On the demand side, affected by the sharp rise in raw material prices in March, some cathode material producers may have signed a small number of orders for early stockpiling, but the overall market remains cautiously watchful, closely monitoring changes in international trade policies and situations. The supply of precursors for power applications still mainly relies on previously signed long-term contracts, while precursors for consumer applications, being more price-sensitive, are mostly traded in spot orders. On the supply side, rising raw material prices and long-term losses have strengthened precursor producers' willingness to stand firm on quotes, and transaction prices remain firm. Long-term contract execution is stable, while spot order pricing is negotiated separately for nickel sulphate, cobalt sulphate, and manganese sulphate. Looking ahead, raw material prices may continue to fluctuate slightly under the influence of market sentiment and international trade policies. Precursor prices will remain relatively firm overall and show slight fluctuations. Ternary Cathode Material: This week, ternary cathode material prices showed slight upward fluctuations, mainly driven by slight increases in nickel sulphate and cobalt sulphate prices, offsetting the impact of lithium salt price adjustments. Overall market supply is still dominated by historically signed long-term contracts, with the discount coefficient not yet adjusted, and price increases mainly reflected in spot quotes. As the procurement order coefficient signed between material plants and upstream precursor producers has increased, ternary cathode material production costs remain at a high level, and material prices remain relatively firm. In terms of production and orders, affected by the sharp rise in raw material prices in March, some battery cell plants chose to place orders in advance, stockpiling in March to meet subsequent production needs. At the same time, recent overseas demand for ternary cathode materials has increased, and some material plants' overseas tolling orders have increased, driving overall market order conditions to improve, with steady and increasing production schedules expected in April. In the short term, ternary cathode material prices are expected to remain firm and fluctuate with raw material prices. LFP: This week, the LFP market remained stable overall, with small price fluctuations. On the raw material side, the average price of lithium carbonate remained stable this week, and processing fees also remained unchanged. However, the price of iron phosphate raw materials has shown a slight upward trend recently, prompting material plants to propose increasing processing fees for Q2 to downstream battery cell plants. On the supply side, LFP material plants' production enthusiasm remained stable this week, but some top-tier enterprises' order volumes decreased compared to the full production plan at the beginning of the month, and actual output did not meet production schedule expectations, although overall output increased compared to February. On the demand side, downstream battery cell plants' production schedules increased significantly compared to February, especially for power battery cells and high-density materials. It is expected that LFP output growth will slow down in April. Iron Phosphate: This week, month-end iron phosphate order negotiations began. Due to the sharp rise in industrial ammonium raw material prices in March, raw material costs increased, and iron phosphate enterprises planned to raise iron phosphate prices by 100-200 yuan/mt, but the negotiation process was not smooth, and downstream LFP enterprises' cost budgets were limited, hindering price increases. New iron phosphate enterprises often use low prices to compete for the market. Recently, iron phosphate supply has been relatively sufficient, making price increases difficult. It is expected that iron phosphate supply will still increase in April, and the market remains optimistic about LFP demand in Q2. LCO: This week, LCO prices declined slightly. As of March 27, the mainstream quotes for 4.2V/4.4V/4.5V LCO were 205,000 yuan/mt, 209,000 yuan/mt, and 220,000 yuan/mt, respectively. Earlier, the sharp rise in upstream raw material Co3O4 prices drove LCO producers to stand firm on quotes, but recently downstream acceptance of high-priced raw materials has been insufficient, and transactions have been weak. Co3O4 prices showed a slight pullback, and LCO prices followed suit. On the supply side, some small and medium-sized LCO enterprises have suspended order acceptance or only execute previous long-term contracts due to insufficient raw material inventory, while top-tier enterprises maintain normal production with stable supply chains. In the short term, LCO prices still have upward support, but the increase may further narrow, mainly because the DRC will evaluate the effect of the export ban in April. If the ban is extended or quota policies are adjusted, raw material shortages may intensify. Anode: This week, anode prices remained stable. On the cost side, against the backdrop of the previous decline in low-sulphur petroleum coke prices, anode and cathode actively entered the market to inquire, pushing petroleum coke prices up this week. In terms of oil-based needle coke, supply-demand relationships and costs showed no significant fluctuations, so prices remained stable this week. In terms of graphitisation, constrained by the rapid development of integration, recent downstream demand has rebounded but to a limited extent, and the oversupply situation is difficult to change. However, considering the narrow profit margin of graphitisation, prices have been relatively stagnant recently. On the supply side, with reduced raw material costs, anode enterprises' production enthusiasm has increased. On the demand side, some battery cell enterprises' purchase volumes have declined due to tariff impacts, and downstream demand recovery may fall short of expectations. In summary, with demand recovery falling short of expectations and supply showing a slight increase, battery cell enterprises' price pressure sentiment is gradually rising. However, as anode enterprises currently use previously high-priced raw materials for production, anode prices have been relatively stagnant recently. Looking ahead, driven by declining raw material prices, anode material prices may see some pullback. Separator: This week, battery separator prices remained stable.Recently, the price of wet-process separators has remained stable without significant fluctuations. Although there is a strong sentiment for price increases in dry-process separators, substantial price adjustments are expected to be delayed until the next round of long-term contract negotiations. From the perspective of supply and demand, the demand for separators from downstream battery cell enterprises continues to grow steadily, and the capacity utilization rate of existing separator production lines is also improving. However, it is worth noting that separator producers are still actively advancing capacity expansion plans, so the oversupply situation in the separator market will persist. In summary, the sentiment for price increases in the dry-process separator sector mainly stems from the fact that current market prices are generally below the industry's average production cost line. However, the specific timing and extent of price adjustments still require continuous monitoring of subsequent market changes. This week, the market price of electrolytes maintained a stable trend. On the cost side, the prices of key raw materials such as LiPF6, solvents, and additives remained stable, keeping the overall manufacturing cost of electrolytes relatively stable. On the demand side, the recovery pace in the downstream new energy battery sector fell short of expectations, and end-users continue to adopt a cautious procurement strategy. Current electrolyte procurement demand shows signs of stabilizing in phases. On the supply side, major producers continue to follow the "produce based on sales" model. Overall, in the short term, the market price of electrolytes will be constrained by the lack of significant changes in supply and demand fundamentals, and is expected to maintain a rangebound fluctuation pattern. This week, the sodium-ion battery industry continued to gain momentum. BYD released its annual report on March 24, announcing that its sodium-ion battery achieved a cell capacity of 200Ah and over 10,000 cycles, and successfully deployed a MWh-level energy storage system. Additionally, HiNa Battery will globally launch its sodium-ion battery commercial vehicle solution and new-generation technology products on March 28. Farasis Energy's sodium-ion batteries have been installed in JMC's related car models, and a 4.5 billion sodium-ion battery project in Jinzhou, Liaoning, has commenced. In the A-share market, some sodium-ion battery concept stocks saw increased leverage funding, with overall performance improving. The industrialization of sodium-ion batteries is expected to accelerate further. This week, the prices of scrap lithium batteries declined slightly, following the slowdown or even slight drop in the prices of nickel salts and cobalt salts. The prices of ternary and LCO black mass also experienced a slight decline. However, on the supply side, grinding mills and traders are still reluctant to lower their psychological selling prices. This week, the coefficients for ternary and LCO black mass remained basically stable. On the demand side, most downstream players are not optimistic about the continued rise in cobalt salt prices, and pure cobalt scrap accounts for less than 10% of the market, with LFP being the dominant material. Enterprises that purchase pure cobalt scrap are relatively fewer compared to those purchasing ternary materials. Given the option to choose ternary black mass, most enterprises are adopting a wait-and-see attitude toward the rising coefficients of pure cobalt scrap. On the supply side, LCO scrap accounts for a relatively small proportion of the overall scrap market, and supply is scarce, with limited quantities mostly concentrated in the hands of traders. In the context of continuously rising cobalt salt prices, many enterprises choose to hold back from selling or sell small quantities at high prices. On the cost side, the prices of cobalt salts and nickel salts began to decline slightly this week, but the previous price increases have somewhat restored the cost and profitability of grinding ternary and pure cobalt scrap. Currently, the profitability of wet-process LCO scrap and ternary scrap hovers around the cost line. However, due to insufficient market supply and the inability of most enterprises to achieve immediate buying and selling of scrap and salt products, some small and medium-sized wet-process enterprises still report being in a loss-making situation. This week, the price of DC-side battery cabins remained stable. The average price of 5MWh DC-side battery cabins was 0.43 yuan/Wh, while the average price of 3.44/3.77MWh DC-side battery cabins was 0.438 yuan/Wh. Following the release of Document No. 136, energy storage projects scheduled before May 31 are being produced as needed, and the price of DC-side battery cabins has stabilized with relatively small fluctuations. Currently, the specific details of energy storage participation in the power market mechanism have not yet been finalized, and project owners may continue to adopt a wait-and-see approach. Energy storage demand is expected to face short-term downward pressure after June 1, and market demand will fluctuate in response to policy impacts once the details are finalized. On March 25, the list of winning candidates for the 300MW/600MWh independent shared energy storage project at the Zhanhua Lubei Base in Shandong was announced. The project, located in Zhanhua District, Binzhou City, Shandong Province, plans to build an LFP battery energy storage system, with supporting construction of a 220kV booster station. The booster station will be connected to the Nanzhao Station via one 220kV line. The first winning candidate quoted a price of 801,459,169.4 yuan, with a unit price of 1.3358 yuan/Wh. The second winning candidate quoted a price of 799,019,900 yuan, with a unit price of 1.3316 yuan/Wh. > Order to view SMM new energy product spot historical prices > Click to view SMM new energy industry chain database News: [US President Trump Announces 25% Tariff on All Imported Cars] On March 26, US President Trump signed an executive order at the White House, announcing a 25% tariff on all imported cars. The measures will take effect on April 2. Trump stated that the car tariffs will be permanent. He said that if cars are manufactured in the US, no tariffs will be levied. Trump mentioned that Tesla CEO Elon Musk has not made any suggestions regarding car tariffs nor sought any benefits from them. Trump also stated that the US will impose tariffs on lumber and pharmaceuticals. [Henan: Aim to Complete Scrappage and Trade-in of Around 500,000 Cars by the End of 2025] The Henan Provincial Development and Reform Commission and others released the "Implementation Plan for Expanding Large-Scale Equipment Updates and Consumer Goods Trade-ins in Henan Province in 2025." The plan specifies that by the end of 2025, the province aims to complete the scrappage and trade-in of around 500,000 cars for individual consumers, trade-in of over 8 million home appliances, promote the scrappage and renewal of approximately 4,700 old commercial trucks and 18,000 sets of agricultural machinery, and update 800 new energy city buses and 4,500 power batteries, further unleashing the consumption potential of digital products, e-bikes, home furnishings, and other products. [Trump Announces Tariff Hike on Imported Cars; Foreign Ministry: US Actions Violate WTO Rules] On March 27, Foreign Ministry spokesperson Guo Jiakun presided over a regular press conference. A reporter from RIA Novosti asked how US President Trump's announcement of a 25% tariff on all imported cars would affect China-US cooperation. "We have noted that the US's major trading partners have already responded," Guo Jiakun said. Trade wars and tariff wars have no winners, and no country's development and prosperity are achieved through tariff hikes. The US's actions violate WTO rules, harm the rules-based multilateral trading system and the common interests of people worldwide, and are not conducive to solving its own problems. SMM New Energy Research Team Cong Wang 021-51666838 Rui Ma 021-51595780 Ziya Lin 86-2151666902 Disheng Feng 021-51666714 Yanlin Lü 021-20707875 Zhicheng Zhou 021-51666711 Zihan Wang 021-51666914 Jie Wang 021-51595902 He Zhang 021-20707850 Haohan Zhang 021-51666752 Yang Xu 021-51666760 Bolin Chen 021-51666836 Mengqi Xu 021-20707868