Raw material prices are rising, making the current period not an ideal time to reach long-term agreements [SMM Ternary Cathode Material Market Weekly Review].

Ternary cathode material prices rose significantly this week. Cost side, support primarily came from a substantial increase in lithium carbonate prices, driving an overall rise in material costs. Among other raw materials, nickel sulphate prices dropped back slightly, cobalt sulphate transactions showed initial signs of increase, manganese sulphate prices held steady, and lithium hydroxide also followed with a slight rise due to linkage effects. Subsequent upside room is expected for cobalt sulphate and lithium carbonate prices, and ternary cathode material prices are likely to remain firm.

Demand side, overall performance was robust. Domestic EV market demand continued to be robust, with leading cathode material enterprises maintaining high operating rates and prioritizing long-term contract deliveries. Based on current production schedules, this positive demand trend is expected to continue through year-end. The small power and consumer electronics markets performed well, driven by the traditional peak season in Q4, with consumer electronics demand also relatively active. Overseas market demand was relatively mediocre recently, and coupled with continued increases in cobalt and lithium metal prices, order volumes contracted slightly.

Approaching year-end, some producers have initiated preliminary discussions on next year's long-term contract commercial terms. However, against the backdrop of rapidly rising raw material prices, this is not an ideal time to reach long-term agreements, and specific negotiation outcomes are expected to take time to become clear.