[SMM Cobalt and Lithium Morning Meeting Summary] Electrolyte prices remain stable, fluctuating rangebound amid tug-of-war between sellers and buyers

Lithium Ore:

At the beginning of this week, the spot and futures prices of lithium carbonate fluctuated slightly, causing suppliers of lithium ore to continue to hold firm on prices at a high level. However, as most enterprises had sufficient lithium ore inventory to meet current production needs, their acceptance of offers above CIF USD 630/mt was limited. Most enterprises adopted a wait-and-see attitude, resulting in generally sluggish market transactions. Market prices remained basically flat compared to last Friday on a WoW basis.

Lithium Carbonate:

At the beginning of this week, the spot price of lithium carbonate showed a slight upward fluctuation.The current market is characterized by a game of "upstream holding firm on prices and downstream driving down prices": smelters maintained high quotes, but downstream cathode material producers' procurement was mainly based on just-in-time needs, resulting in generally sluggish overall market transactions. However, some rigid demand orders still supported a slight upward movement in prices, with the price center of spot prices slightly rising. From the perspective of supply and demand fundamentals, there is still inventory pressure in the industry, and there is an adequate supply of marketable goods. Attention should still be paid to the actual recovery of demand in July.

Lithium Hydroxide:

At the beginning of this week, the price of lithium hydroxide continued its previous downward trend.In terms of production, most enterprises maintained a relatively stable production rhythm, while individual enterprises reduced production due to high inventory levels and pessimistic expectations about future demand. In terms of market sentiment, during the negotiation of orders, lithium chemical plants showed a relatively obvious reluctance to budge on prices and were more inclined to shorten the agreement period. In terms of demand, there was also a clear intention to drive down prices for low-priced orders and spot orders from downstream. In the short term, the downside room for discounts on long-term agreements is limited, and the downward trend in lithium hydroxide prices may decrease.

Refined Cobalt:

On Monday this week, the price of refined cobalt remained stable. On the supply side, refined cobalt smelters maintained long-term contract supply, with fewer spot quotes. Traders generally maintained last week's quotes, with some traders reporting a slight pullback in the prices of individual high-end brands, bringing their market transaction prices back to the producer's ex-factory price.On the demand side, due to the high social inventory of refined cobalt in the midstream and the lack of significant improvement in downstream demand, even with the major positive news of the DRC's extension, most downstream producers still maintained a just-in-time procurement rhythm, with actual transactions remaining sluggish. It is expected that in the short term, the price of refined cobalt will continue to maintain a fluctuating trend.

Cobalt Intermediate Products:

On Monday this week, cobalt intermediate product enterprises still maintained a wait-and-see attitude, with no actual transactions.On the supply side, most mines and traders held a bullish sentiment, suspending quotes, while a small number of quoting enterprises maintained a reluctance to budge on prices. On the demand side, smelters faced difficulties such as production cost losses and sluggish downstream demand. Under uncertain future conditions, they still suspended procurement and mainly consumed their own inventory. Some smelters with relatively low inventory attempted to inquire about prices in the market, but due to significant price differences between buyers and sellers, actual transactions were still difficult. Overall, affected by the DRC's extension policy, China's cobalt intermediate products will still face a shortage of raw materials in the future, and prices have upward momentum. However, during this process, attention should be paid to the inhibition of downstream demand caused by the increase in raw material prices.

Cobalt Salt (Cobalt Sulphate and Cobalt Chloride):

On Monday this week, the price of cobalt sulphate remained stable.On the supply side, the quotes for new goods from most smelters and traders remained near the previous high point of 5.0-5.2, with some smelters and traders reporting that there were older goods in the market that were traded at lower prices. On the demand side, orders from downstream ternary and cobalt oxide enterprises still showed no significant improvement, and they temporarily adopted a wait-and-see attitude, mainly digesting previous inventory. Refined cobalt procurement was still suspended due to its poor economic performance. Overall, under uncertain current conditions, upstream producers insisted on holding firm on prices, while downstream purchase willingness was weak, resulting in limited actual market transactions. It is expected that the price of cobalt sulphate may continue to stabilize this week, waiting for feedback from actual market transactions.
Currently, a few cobalt chloride enterprises are offering quotations at 63,000-65,000 yuan/mt, with some salt smelters choosing to suspend quotations and continue to observe the market. On the supply side, smelters still have a strong wait-and-see sentiment, resulting in fewer market transactions. On the demand side, downstream enterprises have relatively sufficient inventory levels, and the market is actively inquiring, but remains cautious about buying and selling. In terms of prices, although upstream smelters have started to offer quotations, these quotations only represent their expectations of the current market prices. The specific price trend needs to be referenced against the actual transaction prices and inventory levels of upstream and downstream enterprises in the future.

Cobalt salts (Co3O4):

Currently, Co3O4 enterprises are still suspending quotations and shipments, with both upstream and downstream maintaining a wait-and-see attitude and no transactions occurring.Affected by DRC policies, on the supply side, Co3O4 plants choose to suspend quotations and observe the overall market sentiment and demand. On the demand side, LCO cathode plants have relatively low inventory levels, but the overall market has been greatly influenced by sentiment recently, leading them to choose a wait-and-see approach. In terms of prices, there are no quotations in the current market, but some Co3O4 plants indicate that their shipment expectations may be between 210,000-220,000 yuan/mt. The specific price trend and change range still need to be judged when actual transactions occur. In the long term, Co3O4 prices are still influenced by cobalt inventory levels. Whether the current industry inventory can support the market until December has become a key factor affecting the price trend.

Nickel sulphate:

On June 30, the SMM battery-grade nickel sulphate index price was 27,192 yuan/mt, with the quotation range for battery-grade nickel sulphate being 27,200-27,600 yuan/mt, and the average price remaining stable WoW.In terms of costs, affected by the general rise in non-ferrous metals and the rebound from oversold conditions, LME nickel prices have rebounded. Overall, the immediate production costs of nickel salts have increased. From the supply side, some nickel salt smelters have halted production for maintenance due to losses, while some have maintained stable quotations. From the demand side, precursor plants have seen a decrease in inquiry enthusiasm due to weak demand. This week, market transactions and inquiry activity have remained at a low level. Looking ahead, it is expected that sentiment will drive nickel salt prices upward, but the upward range will still be limited by weak downstream demand.

Ternary cathode precursor:

On Monday, the prices of 5-series, 6-series, and 8-series ternary cathode precursor products remained stable overall.In terms of raw material costs, the prices of nickel sulphate and manganese sulphate were basically flat. Due to the continued weakness in the ternary market, cobalt sulphate lacked the driving force for price increases, resulting in relatively small overall fluctuations. Most producers believe that the current precursor prices lack upward momentum, and the discount coefficient has not undergone significant adjustments. On the demand side, the overall market in June was in a destocking phase, with relatively mediocre performance. July is expected to see a small-scale restocking, but the restocking volume will be limited. Although there has been some order transfer in the NEV market, the overall demand volume has not changed significantly. The consumer market may be impacted by the "power bank recall" incident, with subsequent orders possibly facing certain challenges. Overall, the market is cautious about Q3 this year, and it may be difficult to see significant increases during the traditional "September-October peak season".

Ternary cathode material:

On Monday, the prices of 5-series ternary cathode materials remained stable, while the prices of 6-series and 8-series materials decreased slightly. In terms of raw materials, the prices of nickel sulphate, cobalt sulphate, and manganese sulphate did not fluctuate significantly.Lithium carbonate rebounded slightly under the influence of the futures market, while lithium hydroxide continued its downward trend. On the demand side, affected by the semi-annual period, some producers actively destocked due to cash flow considerations, resulting in a relatively weak overall market performance. In the NEV market, some new car models have driven appropriate stockpiling. However, the consumer market has been impacted by the "power bank recall" incident, with short-term orders facing certain pressures. On the supply side, according to the current production schedule in July, there has been a certain recovery MoM, but the recovery range is relatively limited. In terms of prices, there has been no change in the discount coefficient of ternary cathodes so far, and downstream battery cell manufacturers remain cautious about the upward trend in cobalt sulphate prices. Overall, it is expected that the short-term prices of ternary cathode materials will still show a slight downward trend with fluctuations in raw materials.

LFP:

This week, the price of LFP dropped slightly, with an overall decrease of about 25 yuan/mt. After the price of lithium carbonate fell this week, it rebounded, showing an overall slight downward trend, with a cumulative decrease of about 100 yuan/mt.In the market, the overall production of material plants has been relatively stable this week. After the impact of the US tariff reduction, there has been a significant increase in ESS orders, driving the overall production enthusiasm of the industry. However, orders in the NEV market have still maintained a slight downward trend, mainly due to the NEV market's demand and performance falling short of expectations, and the expected weekly decrease in the production schedule of downstream battery cell manufacturers in the NEV market. It is expected that the production of LFP materials in June will increase slightly driven by ESS demand, but the increase will be very limited.

Iron phosphate:

This week, the price of iron phosphate continued to weaken, while in the raw material market, the prices of industrial-grade MAP and phosphoric acid remained stable, and the price of ferrous sulphate increased with tightening supply.After some high-priced iron phosphate enterprises lowered their prices, the order situation barely maintained. In June, some iron phosphate enterprises had considerable order volumes and high operating rates, but this was mostly concentrated among enterprises with resource advantages and competitive product prices. With the expansion of production capacity or production recovery of some downstream enterprises, the demand for iron phosphate is expected to grow. The overall market is temporarily stable, with payment terms being a key concern during mid-year tenders and order negotiations.

LCO:

Recently, LCO enterprises have still not offered quotations.The price adjustment of LCO is mainly driven by changes in raw material costs: recently, the price of battery-grade lithium carbonate has continued to decline, while the price of Co3O4 has shown strong upward sentiment due to DRC policies. On the supply side, Co3O4 enterprises have chosen to suspend quotations and shipments. LCO cathode plants still need to wait for clear upstream prices before determining subsequent prices and shipment situations. On the demand side, terminal battery cell manufacturers still have sufficient inventory levels, but their acceptance of prices needs to consider whether raw material costs can be passed on to the terminal. Overall, it is expected that LCO prices will see a significant increase in the short term, with the specific range needing to be referenced against the transaction situation of Co3O4.

Anode:

This week, the price of artificial graphite anode material will remain relatively stable.On the demand side, constrained by high finished vehicle inventory levels, automakers have slowed down their production pace, resulting in weak growth in demand for power battery cells. However, the demand in the small ESS market has recovered, effectively offsetting some of the demand gaps caused by the decline in NEV demand. This change in demand structure has been transmitted layer by layer, maintaining relatively stable demand for anode materials at the battery cell level, with no significant changes in the supply-demand relationship. Looking ahead, although overcapacity is difficult to improve in the short term, there is an expectation of a stop falling and rebound in the prices of relevant raw materials, and cost support is expected to gradually strengthen. The price of anode materials may gradually enter a stable operation phase.
This week, supported by the dual stability of the cost side and supply side, the market price of natural graphite anode material remained stable. Looking ahead, as technological innovation in artificial graphite anode accelerates, the gap in core performance indicators such as specific capacity and cycle life between artificial and natural graphite continues to narrow. Downstream customers, driven by cost reduction, efficiency improvement, and performance upgrade needs, are gradually shifting their procurement preferences toward artificial graphite anode, significantly squeezing the demand for natural graphite anode. Consequently, the price of natural graphite anode material is expected to face sustained downward pressure in the long term.

Separator:

This week, separator prices remained generally stable.Specifically: mainstream quotations for wet-process separators were 1.35 yuan/m² for 5μm, 0.76 yuan/m² for 7μm, and 0.74 yuan/m² for 9μm. Dry-process separator quotations were 0.45 yuan/m² for 12μm and 0.44 yuan/m² for 16μm. On the supply side, constrained by prolonged capacity release cycles, accumulated surplus capacity has not yet been fully absorbed, leading to a persistent supply surplus. Demand exhibited structural divergence: NEV market demand fell short of expectations, while ESS sector demand outperformed prior market forecasts, resulting in a slight MoM increase in overall demand. Given the current supply-demand balance, separator prices are expected to remain stable in the short term, with limited fluctuations.

Electrolyte

This week, electrolyte prices held steady.Cost side, core raw materials such as LiPF6, solvents, and additives remained stable, keeping overall production costs steady. Demand side, seasonal factors led to sluggish auto sales, causing a slight MoM decline in power battery demand. Overseas ESS demand showed growth, stabilizing overall demand. Supply side, producers deepened their "produce based on sales" model. With persistently low market prices, some producers selectively abandoned low- or negative-margin orders. However, due to structural overcapacity, competitive pressure remains significant, forcing some firms to adopt volume discounts. Multiple factors suggest electrolyte prices will continue to fluctuate rangebound.

Sodium-ion Battery

This week, the sodium-ion battery market showed positive momentum.Taking NFPP as an example, capacity is ramping up, driving increased shipments. Downstream demand is concentrated in ESS and start-stop applications. As NFPP capacity gradually expands, economies of scale are emerging, reducing costs and steadily lowering per-mt prices. This price advantage enhances sodium-ion batteries' competitiveness, attracting more firms and consumers, paving the way for broader market growth.

Recycling

This week, prices for ternary and LCO black mass in the disassembly recycling market rebounded slightly. Cobalt sulphate prices continued to rise, nickel sulphate prices were basically stable, and lithium carbonate prices edged up with oscillations.Coefficients for ternary and LCO black mass remained flat, with cobalt coefficients slightly up and lithium coefficients declining. LFP pole piece black mass prices per % lithium stood at 2,150-2,300 yuan/mtu, while LFP battery black mass prices were 1,950-2,100 yuan/mtu. Demand side, most ternary and LFP wet-process mills maintained stable procurement volumes this month, consuming only basic inventory, with sluggish market activity. Supply side, grinding mills and traders adjusted selling prices downward in line with falling salt prices. Currently, except for leading integrated wet-process mills, most wet-process players remain below the breakeven line.

Downstream and End-User

This week, DC-side battery cabin prices held steady.The average price for 5MWh DC-side battery cabins was 0.432 yuan/Wh, while 3.44/3.77MWh cabins averaged 0.437 yuan/Wh. Provinces are implementing mechanisms and policies for ESS participation in power markets, with owners and integrators adopting a wait-and-see approach. The ESS market remained stable, with minimal price fluctuations. SMM expects DC-side battery cabin prices to stay stable in the short term.

On June 23, the EPC contract for Changyuan City Rongyuan 200MW/400MWh standalone ESS project was awarded. The project, to be built in Changyuan City, Xinxiang, has a total capacity of 200MW/400MWh. The bid winner quoted 283.6 million yuan, translating to a unit price of 0.709 yuan/Wh.

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