[SMM Analysis] Pre-National Day Lithium Battery Recycling Market Review

This week, prices for salt products such as cobalt sulphate and nickel sulphate continued to rise, driving the nickel and cobalt payable indicators in ternary and LCO black mass to remain largely flat, while the lithium payable indicator also held steady. Taking LFP pole piece black mass as an example, its current price is 2,650-28,000 yuan per % lithium, and the price per % lithium for LFP black mass remained stable this week. For ternary black mass, the nickel and cobalt payable indicator for ternary pole piece black mass currently stands at 73.5–75.5%, up 0.5% WoW; the lithium payable indicator is 69–72%, also rising about 1% WoW.

From a profit perspective, producing lithium carbonate by externally purchasing LFP black mass currently remains loss-making, with a profit margin of approximately -5% to -6%. Except for several newly commissioned LFP battery hydrometallurgy recycling plants this year, most LFP recycling enterprises have production lines for producing lithium carbonate from other raw materials. Therefore, even though lithium carbonate prices rebounded, most enterprises chose to halt procurement and production amid sustained losses. Profits in the ternary hydrometallurgy sector are also relatively low, fluctuating basically in the 1–3% range; LCO hydrometallurgy enterprises performed slightly better than LFP and ternary enterprises, maintaining a profit margin of around 3%.

Supply side, as prices for nickel, cobalt, and lithium increased, upstream recycling enterprises quickly raised prices for raw materials such as LCO batteries, LFP batteries, and pole pieces, and black mass prices also rose accordingly. However, demand side, as this round of lithium carbonate price increases is related to factors such as China-US trade and coking coal, most enterprises maintained a wait-and-see attitude against the backdrop of losses, with the majority of LFP battery hydrometallurgy recycling plants currently focusing on maintaining toll processing for Business-to-Business (B2B) clients.

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