[SMM Cobalt Morning Meeting Summary] Cobalt sulphate prices fell this week, and may maintain a fluctuating trend next week

Refined Cobalt:

This week, the spot price of refined cobalt has shown signs of recovery. From the supply side, production cuts at refined cobalt smelters continue, and the market is still digesting social inventory. From the demand side, downstream producers have not seen a significant recovery in orders and are maintaining a purchasing rhythm based on production schedules as needed, with no significant restocking actions observed downstream yet. According to the latest news, the DRC has not yet announced relevant policies regarding the ban on cobalt exports, and it is expected to announce follow-up measures in June. It is anticipated that the short-term supply and demand situation will remain unchanged next week, and the price of refined cobalt may fluctuate.

Intermediate Products:

This week, the spot price of cobalt intermediate products has held up well. According to the latest news, the DRC has not yet announced follow-up policies regarding cobalt exports, and it is expected to announce relevant measures in June. On the supply side, traders are maintaining their quotations, and the current mainstream spot quotations for cobalt intermediate products have slightly increased and remained high, following the buying sentiment. On the demand side, as some downstream producers have already completed restocking in the early stage, there has been little purchasing activity recently, and spot transactions for cobalt intermediate products have been relatively sluggish. It is expected that cobalt intermediate products may operate steadily next week.

Cobalt Sulphate:

This week, the spot price of cobalt sulphate has fallen. From the supply side, spot quotations for cobalt sulphate at smelters have slightly loosened, and quotations from recycling plants have also declined. From the demand side, downstream cathode precursor plants have shown weak acceptance of the current cobalt sulphate prices, with no purchasing activity observed yet; while Co3O4 enterprises are mainly adopting a wait-and-see attitude, resulting in extremely weak spot transactions for cobalt sulphate recently. It is expected that the spot price of cobalt sulphate may maintain a fluctuating trend next week.

Cobalt Chloride:

This week, the price of cobalt chloride has slightly declined. From the supply perspective, due to unresolved issues with the transportation cycle of overseas cobalt raw materials, smelters remain cautious in their quotations, with almost no instances of low-price dumping. From the demand perspective, the purchasing rhythm of downstream Co3O4 enterprises has slowed down, with fewer market inquiries, and spot transactions are mainly for small-batch rigid demand. It is expected that the peak sales season for NEVs in Q3 may drive a rebound in restocking demand from downstream enterprises, and the cobalt chloride market may continue to fluctuate at highs. Industry insiders maintain a strong wait-and-see attitude towards cost transmission and policy expectations.

Cobalt Salts (Co3O4):

This week, the price of Co3O4 has continued to decline. Despite the export ban in the DRC leading to high raw material costs, excessive domestic inventory has also suppressed the upward momentum of prices, with spot quotations remaining weak. Downstream demand has not shown significant improvement, and most LCO enterprises are still purchasing as needed. The market inquiry atmosphere is sluggish, with fewer effective transaction orders, and the overall market is in a wait-and-see phase. The industry is generally waiting for further news stimuli, and it is expected that the spot price of Co3O4 will continue to decline in the short term.

Cobalt Powder and Others:

This week, the quotations of enterprises in the cobalt powder market have remained stable overall, with actual transaction prices slightly lower than the quotations. From the supply and demand perspective, although demand from the downstream alloy industry remains relatively stable with sufficient inventory, the purchase willingness of downstream buyers for primary cobalt powder is significantly low.

Ternary Cathode Precursor:

This week, the prices of 5-series, 6-series, and 8-series products in the ternary cathode precursor market have decreased. In terms of raw material costs, the prices of nickel sulphate, cobalt sulphate, and manganese sulphate have all shown a downward trend, driving down the prices of precursor products of different series. From the demand side, the overall performance of the large NEV precursor market has been mediocre. Despite some order transfers among manufacturers, there has been no significant increase in overall demand, which is still mainly supported by existing projects. Orders for small power and consumer precursors have increased recently, mainly influenced by rising cobalt prices, with some downstream material plants choosing to restock in advance, but the actual increase in demand has been limited. On the supply side, affected by market fluctuations this year, NEV precursor producers generally no longer sign long-term (e.g., half-year or one-year) orders, instead opting for monthly negotiations on discounts for transactions. Some enterprises have increased the discount coefficients for long-term contracts, but downstream customers have shown low acceptance of the adjusted prices. Consumer precursors are still mainly sold on a spot basis, with discount coefficients remaining stable since April. Currently, precursor enterprises and downstream material plants are still in a price negotiation phase. Looking ahead to next week, it is expected that raw material prices will continue to fluctuate, and the price of ternary cathode precursors may decrease slightly.

Ternary Cathode Material:

This week, the price of ternary cathode material has continued to decline. In terms of raw materials, the prices of nickel sulphate, cobalt sulphate, manganese sulphate, lithium carbonate, and lithium hydroxide have all shown varying degrees of decline, but the decline in lithium chemicals has slowed down. From the demand side, the large NEV market has performed steadily. Although individual automakers have achieved good sales, providing some support for ternary cathode material, the increase in demand has been limited. The traditional peak sales season for the consumer market has not yet started. Although some producers have restocked in advance due to rising cobalt prices, the overall increase in demand remains limited. On the supply side, the current market supply mainly relies on previously signed long-term contracts, with some enterprises increasing the relevant discount coefficients. In terms of spot transactions, producers generally adopt a settlement method of negotiating discounts separately for raw materials such as nickel sulphate, cobalt sulphate, and lithium carbonate. The discount coefficients for spot quotations have increased, but downstream acceptance has been low. Recently, market transaction sentiment has been weak, mainly influenced by the continuous decline in lithium carbonate prices. The market remains pessimistic about its future outlook, leading to weak willingness of ternary cathode material producers to sell. In addition, downstream battery plants have already completed some restocking in the early stage, with low purchase willingness in the short term. In terms of price trends, it is expected that raw material prices will continue to decline slightly, and the price of ternary cathode material may further decrease due to fluctuations in raw material prices.

LCO:

This week, the mainstream quotations for 4.2V/4.4V/4.5V LCO in the market are 219,000 yuan/mt, 224,000 yuan/mt, and 235,000 yuan/mt, respectively. On the raw material side, battery-grade lithium carbonate continued its downward trend this week, and the price of Co3O4 slightly declined. Influenced by raw material prices, the price of LCO slightly decreased this week. On the supply side, since April, top-tier enterprises have fully released their capacity, with stable production increases maintained at high levels. On the demand side, terminal producers are restocking for the 618 shopping festival, driving an increase in purchase orders from battery cell manufacturers. In addition, influenced by DRC policies, there is still significant uncertainty regarding cobalt, so LCO cathode plants are cautious in their sales.

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SMM New Energy Research Team

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Ma Rui 021-51595780

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