【SMM Cobalt & Lithium Morning Meeting Summary】Separator prices are close to the cost line, and separator prices may rise slightly

Lithium Ore:

At the beginning of this week, lithium ore prices continued to decline WoW. As lithium carbonate prices continued to fall, downstream acceptance of spodumene concentrate prices continued to decline, with weak purchase willingness for overseas mine SC6 CIF $790-800/mt quotes. Coupled with high inventory levels at ports recently, suppliers' willingness to sell increased, with transaction prices reaching as low as SC6 CIF $750/mt, further pulling down overall market prices. For lepidolite, as lithium carbonate prices fell, losses continued, with lithium chemical plants reducing both self-produced and toll-processed output. The acceptable prices for lepidolite concentrate continued to decline, driving market prices lower.

Lithium Carbonate:

At the beginning of this week, spot lithium carbonate prices fell sharply, continuing to decline under pressure. Demand side, downstream material plants had largely completed their stocking before the Labour Day holiday, with significantly weaker purchase willingness. Coupled with end-use demand falling short of previous incremental expectations, market sentiment remained cautious. Supply side, although some small and medium-sized lithium chemical plants had reduced output, overall production remained high, with relatively abundant market supply. Meanwhile, low-priced transactions of lithium-bearing spodumene emerged at the raw material end, weakening cost support. Considering current market supply-demand dynamics and raw material price trends, lithium carbonate prices are expected to maintain a weak fluctuating trend in the short term.

Lithium Hydroxide:

At the beginning of this week, lithium hydroxide prices continued to decline WoW. Recently, affected by macro policies, domestic and overseas ternary cathode material plants have seen some changes in orders, resulting in insignificant overall demand growth. On the other hand, lithium hydroxide suppliers have high inventory levels, with most transactions being long-term contract cargo pick-ups and few spot transactions. Spot prices and discounts for long-term contracts have shown a downward trend. Coupled with the downward pull of lithium carbonate prices, lithium hydroxide prices have also shown a downward trend.

Refined Cobalt:

This week, spot refined cobalt prices have remained relatively stable. From the supply side, current social inventory levels in the market remain high, but the inventory structure shows slight differences. From the supply side, due to high raw material costs, the economic viability of refined cobalt production is poor, and future production cuts by smelters are likely to continue. However, overall market liquidity remains sufficient. From the demand side, inquiries and purchases by downstream producers have been relatively mediocre. It is expected that refined cobalt prices will maintain a fluctuating pattern this week.

Intermediate Products:

This week, spot prices for cobalt intermediate products have fluctuated upward. On the supply side, upstream producers have generally suspended spot order quotations to secure long-term contract clients, with some long-term contract delivery expectations extended. Only a few traders are trading and shipping, resulting in relatively low overall market liquidity. Downstream inquiries and purchases have been relatively active, with some producers engaging in restocking, leading to high actual transaction activity for cobalt intermediate products. This week, the short-term supply-demand pattern is unlikely to improve significantly, and spot prices for cobalt intermediate products may continue to fluctuate upward.

Cobalt Salts (Cobalt Sulphate and Cobalt Chloride):

This week, spot prices for cobalt sulphate have remained stable. From the supply side, cobalt salt smelters have continued to stand firm on quotes and hold back sales, maintaining relatively high offer prices, but actual transactions remain very mediocre. From the demand side, downstream producers are generally cautious about new cobalt salt supplies from smelters, only maintaining regular inquiries, and have not yet shown significant buying interest. Some enterprises are still digesting old social inventory. It is expected that the short-term supply-demand situation for cobalt sulphate is unlikely to improve significantly this week, and spot prices may continue to fluctuate.

At the beginning of this week, cobalt chloride prices remained stable. From the supply side, due to increasingly tight raw material inventories, most producers have refused to sell at low prices, keeping quotes high. On the demand side, despite low overall market activity, some producers still maintain a certain level of purchasing demand for cobalt chloride to ensure stable production line operations, keeping transaction prices stable at high levels. It is expected that even with low market activity this week, suppliers' reluctance to sell will remain strong, leading to cobalt chloride prices continuing to run at high levels with some upside potential.

Cobalt Salts (Co3O4):

At the beginning of this week, spot prices for Co3O4 fell slightly. From the supply side, market performance has been weak, with some smelters lowering quotes and increasing willingness to sell, but overall transaction activity remains low. On the demand side, some enterprises have completed necessary purchases, reducing their acceptance of high-priced Co3O4 and leading to decreased transaction activity. Considering current market dynamics and demand trends, Co3O4 prices are expected to face downward pressure this week.

Nickel Sulphate:

On April 28, the SMM battery-grade nickel sulphate index price was 27,815 yuan/mt, with a quotation range of 27,820-28,340 yuan/mt for battery-grade nickel sulphate, and the average price remained stable compared to the previous day. Cost side, LME nickel prices have been supported by costs and affected by Indonesian policies, leading to strong cost support for nickel sulphate recently. Additionally, affected by production cuts in Indonesian MHP and high-grade nickel matte projects, raw material supply has been tight, pushing MHP coefficients to remain high with limited downward momentum. Supply side, some nickel salt smelters have limited remaining quantities available for external sales in May, leading to firm quotes. Some nickel salt smelters have production cut expectations due to incomplete raw material stocking. Moreover, with raw material prices running high, their prices remain firm. Demand side, as the circulation of nickel salts produced from low-cost scrap has largely been exhausted, inquiries from precursor plants for nickel sulphate produced from primary materials have increased this week. Additionally, precursor plants' acceptance of nickel sulphate prices has improved. Looking ahead, based on tight raw material supply, solid cost support, and downstream demand dependence, nickel salt prices are expected to show a mild upward trend in the short term.

Ternary Cathode Precursors:

On Monday, prices for 5-series for consumer electronics, 6-series for consumer electronics, and 8-series for NEV products in the ternary cathode precursor market remained stable. In terms of raw material costs, prices for nickel sulphate, manganese sulphate, and cobalt sulphate have remained generally stable without significant fluctuations. Demand side, overall market transaction sentiment has been relatively cold this week, with enterprises continuing to execute production schedules and existing orders. Small power and consumer-type precursors have seen relatively good demand recently, with relatively active order signing. Orders for large power-type precursors have remained relatively stable. Supply side, affected by prolonged losses in precursor products, enterprises have strong willingness to stand firm on quotes, with transaction prices remaining firm. Considering significant market volatility this year, producers of power-type precursors have generally ceased signing long-term (e.g., six-month or one-year) orders, instead adopting monthly discount negotiations. Meanwhile, some producers have increased discount coefficients for cobalt sulphate and nickel sulphate. For the consumer-type precursor market, spot transactions still dominate. Looking ahead this week, sulphate prices are expected to rebound slightly, and precursor prices may rise slightly driven by increases in raw material prices.

Ternary Cathode Materials:

On Monday, ternary cathode material prices fell slightly. In terms of raw materials, prices for nickel sulphate, cobalt sulphate, and manganese sulphate have remained generally stable, while lithium carbonate and lithium hydroxide prices have continued to decline. Currently, market supply mainly relies on previously signed long-term contracts, with some enterprises having increased relevant discount coefficients. For spot transactions, producers generally negotiate discounts separately for raw materials such as nickel sulphate and cobalt sulphate for settlement. In terms of production and order execution, demand for small power and consumer-type ternary cathode materials has performed relatively well this month, with relatively active order signing. Demand for large power-type ternary cathode materials has remained relatively stable. It is expected that total market supply in May will show a slight increase, mainly driven by small power, consumer-type orders, and demand from some overseas large power customers. From a product structure perspective, demand for medium-nickel ternary cathode materials has increased in Q2, and it is expected that the market share of 6-series ternary cathode materials will further increase, gradually squeezing the market share of 8-series ternary cathode materials. Due to the current cost advantages of medium-nickel materials, the trend towards medium-nickelization is expected to emerge in overseas markets simultaneously. In terms of prices, it is expected that ternary cathode material prices will still be affected by the downward trend in lithium chemical prices this week, showing an overall slight fluctuating trend.

LFP:

This week, LFP prices have generally declined, falling by approximately 400 yuan/mt, mainly due to a significant drop in lithium carbonate prices this week, which fell by about 1,550 yuan/mt. Market dynamics: On the supply side, material plants maintained stable production this week, with overall April production increasing by approximately 1-2% compared to March. On the demand side, downstream battery cell manufacturers' demand has been relatively stable, showing some growth compared to March but with a smaller increase. In late April, the overall cargo pick-up progress of battery cell manufacturers has slowed down somewhat, with demand not showing significant incremental expectations. In terms of price settlement, in April, material plants will renegotiate processing fees for Q2 with battery cell manufacturers, but no actual progress has been made. It is expected that overall production in May will show a slight increase, and material plants will continue negotiations with battery cell manufacturers on settlement prices.

Iron Phosphate:

This week, the iron phosphate market has shown a relatively flat trend. On the raw material side, industrial-grade MAP prices have started to loosen, with ferrous sulphate prices falling to the 200-300 yuan range. As a result, iron phosphate production costs have decreased. However, as the month-end approaches, iron phosphate's strategy to stand firm on quotes has been ineffective due to a lack of cost support. Meanwhile, April market demand for iron phosphate has fallen short of expectations, with sufficient market supply, putting iron phosphate enterprises in a difficult position. In this situation, some enterprises plan to cut production to cope with current difficulties and stabilize market supply-demand relationships.

LCO:

This week, the LCO market has continued the tug-of-war between supply and demand, with mainstream quotations for 4.2V/4.4V/4.5V LCO at 224,000 yuan/mt, 228,000 yuan/mt, and 238,000 yuan/mt, respectively. On the supply side, with the completion of industry resumption in March, capacity utilization rates have recovered to high levels, and it is expected that production schedules in April will increase by 3% MoM. On the demand side, Q2, as the peak consumption season for 3C electronics, will drive increased purchasing demand from battery cell manufacturers. In terms of prices, LCO prices are mainly affected by raw material prices. This week, prices for cobalt and lithium carbonate have declined. Additionally, both buyers and sellers of LCO have adopted a wait-and-see attitude, leading to a recent decline in LCO prices.

Anode:

This week, prices for artificial graphite have remained relatively stable. On the supply-demand front, market demand lacks upward drivers, with downstream battery cell manufacturers' production schedules showing no significant growth compared to last week, and the overall operating rate of the anode market remaining at last week's level. Cost side, price trends for various raw materials have diverged, with the tug-of-war between supply and demand and costs in the graphitisation tolling services market continuing, and prices remaining stagnant. Raw material coke prices have declined due to low purchasing enthusiasm from anode and cathode producers. Considering the cost accounting of various raw materials, the production cost of anode materials has decreased this week. However, considering that the raw materials currently used in the production of artificial graphite anodes were mostly purchased at high prices earlier, supported by costs, artificial graphite prices have remained firm this week. Looking ahead to next week, affected by the ongoing impact of tariff policies, the pace of demand expansion from downstream battery cell manufacturers will be somewhat constrained. The robust development momentum of the domestic new energy market is expected to offset some of the negative effects of tariffs, effectively supplementing market demand. Therefore, under the combined effects of relatively stable supply-demand relationships and cost support, it is expected that artificial graphite prices will maintain a stable trend in the short term.
This week, the price of natural graphite anode material remained stable. On the supply and demand front, the overall market performance was steady. Compared to last week, there were no significant changes in either the procurement scale on the demand side or the shipments on the supply side, with the market maintaining a relatively stable operation compared to last week. On the cost side, there were no notable fluctuations in the prices of upstream raw materials this week. Looking ahead, influenced by tariff policies, downstream demand is expected to decline, and the price of natural graphite anode material is anticipated to face downward pressure.

Separator:

This week, the prices of lithium battery separator materials remained stable. The mainstream quotations for wet-process separators of 5um/7um/9um were 1.59 yuan, 0.82 yuan, and 0.75 yuan, respectively. The mainstream quotations for dry-process separators of 12um/16um were 0.46 yuan and 0.43 yuan, respectively. On the supply side, with the completion of industry chain resumption of work and production in March, the industry's capacity utilization rate has recovered, and it is expected that there will be a slight increase in production schedules for April. On the demand side, downstream demand for NEV and ESS remains on the rise, which will drive battery cell manufacturers to increase their procurement of separators. In terms of prices, as separator prices have already approached the cost line, it is expected that separator prices may rise slightly in the near future.

Electrolyte

This week, the market price of electrolytes remained temporarily stable. On the cost side, the price of the core raw material, LiPF6, decreased, while the prices of solvents and additives remained stable, leading to a decrease in the overall manufacturing cost of electrolytes. On the demand side, the recovery process of the downstream new energy battery market continues to fall short of expectations. Recently, influenced by changes in tariff policies, market demand has become increasingly sluggish. Terminal customers, considering market uncertainties, continue to adopt a cautious stockpiling strategy, strictly controlling inventory levels. Market trading activity remains low, making it difficult to form strong demand support. On the supply side, major enterprises in the industry continue to deepen the "produce based on sales" operational model and, based on cautious predictions of market demand, actively adopt conservative production scheduling strategies. A comprehensive analysis of the current electrolyte market landscape reveals that, given the lack of fundamental shifts in the short-term market supply and demand fundamentals, there are no key factors driving significant price fluctuations. It is expected that electrolyte prices will continue to fluctuate rangebound in the coming period.

Sodium-ion battery:

This week, the sodium-ion battery market remained stable, with average trading activity. CATL held a Super Tech Day event, launching the "Na Xin" sodium-ion battery brand and related products. Its power sodium-ion battery has an energy density of 175wh/kg and is set for mass production in December, attracting market attention. With the gradual commissioning of supporting production lines for sodium-ion battery anode/cathode materials and battery cells in 2025, if mass production is achieved, sodium-ion battery costs are expected to decrease, further enhancing their market competitiveness.

Recycling:

On the supply side: This week, prices of salt products such as lithium salts, nickel salts, and cobalt salts mainly declined steadily. This week, the black mass coefficients for ternary and LCO remained basically stable. Taking ternary black mass as an example: the current coefficient for ternary pole piece black mass is 75-78%, and for ternary battery black mass, it is 72-75%. On the supply side, the psychological selling prices of grinding mills and traders have decreased with the fall in salt prices. However, some grinding mills, as their current profits are still below the surplus line, choose to hold back from selling and wait for market conditions to improve. Market transactions were even sluggisher compared to March. On the demand side, most wet-process plants only made just-in-time procurements of black mass amid the continuous decline in nickel, cobalt, and lithium salt prices. Moreover, due to the market's pessimistic outlook on subsequent lithium salt prices, they only stockpiled about one month's worth of safe raw material inventory. On the cost side, except for leading integrated wet-process plants, the profits of most wet-process plants remain below the surplus line. While the profits of grinding mills are slightly better than those of wet-process plants, the recent decline in copper cathode prices has also led to a continuous inversion of grinding mill profits.

Downstream and terminal:

This week, the prices of DC-side battery cabins remained stable. The average price of a 5MWh DC-side battery cabin is 0.43 yuan/Wh, while the average price of 3.44/3.77MWh DC-side battery cabins is 0.438 yuan/Wh. Domestic ESS projects are generally scheduled based on demand, resulting in minimal price fluctuations for DC-side battery cabins.

On April 22, the winning bid result for the EPC general contracting of the Heshan Suoying Xinneng Common Mode 300MW/900MWh ESS Power Station Project was announced. The project is located in Heshan City, Laibin City, Guangxi Zhuang Autonomous Region, with an ESS capacity of 300MW/900MWh. It includes the construction of a booster station with a floor area of 7,500㎡ and a main transformer low-voltage side voltage of 35kV. The bid winner's quotation was 1.305 billion yuan, which translates to a unit price of 1.45 yuan/Wh after conversion.

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