How can we manage without a price increase next year? [SMM Ternary Cathode Precursor Market Weekly Review]

Ternary cathode precursor prices rose slightly this week. On the raw material side, nickel sulphate and manganese sulphate prices rebounded slightly, while cobalt sulphate remained stable. Spot order discounts saw relatively small changes compared to last week, with market focus still concentrated on the progress of long-term contract negotiations for next year.

Approaching year-end, most producers have not yet finalised the commercial terms for next year's long-term contracts, mainly due to a certain gap in the psychological price levels between upstream and downstream players. Downstream cathode plants currently have a strong desire to bargain down prices, while precursor producers, if facing long-term severe loss pressure, would rather choose not to accept orders. The stalemate between upstream and downstream has persisted for over a month. If neither side makes concessions going forward, shortening the order cycle and prioritising short-term supply and demand may become a feasible solution.

On the demand side, power and consumer market demand continued to pull back recently. Some producers, based on inventory control considerations, have slowed down their production pace. Demand in January next year is expected to decline further. However, as long-term contracts for most producers have not been confirmed and January orders are not fully settled, the market direction lacks a clear conclusion for now.

Price-wise, influenced by firm cobalt sulphate prices, ternary cathode precursor prices are expected to have further room to rise by the end of this month and early January next year.