【SMM Analysis】Ternary Cathode Producers Cut June Production Plans to Cope with Soft Demand

This week, ternary cathode material prices continued their modest downward trend. On the raw material front, nickel sulfate and manganese sulfate prices held steady, cobalt sulfate transaction prices softened, while lithium carbonate and lithium hydroxide prices continued to trend lower amid volatility.

Over the past two weeks, transaction sentiment in the ternary market has remained relatively subdued. The EV market has largely maintained long-term contract deliveries, while the e-mobility and consumer markets continued with need-based restocking. As the mid-year period approaches, manufacturers are generally reluctant to build additional inventories and are instead consuming existing raw material stocks. As a result, both cathode manufacturers' willingness to purchase lithium salts and precursors, and battery cell manufacturers' willingness to purchase cathode materials, have remained weak. This has led to a situation where, despite continued supply tightness and cost pressures on the raw material side, actual transaction payables have not moved higher. Instead, they have shown a downward trend due to weak buying sentiment downstream.

On the demand side, leading domestic battery cell manufacturers have revised down their demand this week, with June production schedules expected to decline compared with early-month forecasts. However, overall demand levels remain relatively high.