[SMM Analysis] Mid-year period impacts downstream cargo pick-up willingness, nickel sulphate prices drive precursor prices weaker

This week, ternary cathode precursor prices weakened. Nickel sulphate and cobalt sulphate prices edged down, while manganese sulphate prices rose slightly.

On the discount side, for July and Q3 orders, some producers showed a willingness to raise discounts amid relatively tight sulphate raw material supply. For long-term contracts, some producers had already agreed on annual terms early in the year, with no increase in coefficients yet; downstream customers also showed weak acceptance of coefficient hikes for quarterly orders. For spot orders, nickel and cobalt payables for some consumer-related spot orders ticked up in June, but owing to the relatively weak performance of nickel and cobalt salt prices recently, coefficients for July orders have yet to rise further.

On the production side, top-tier producers continued to see strong export orders this month and maintained high production schedules. However, some producers reduced operating rates as downstream inventory control at mid-year led to a buildup of finished product inventories.

Looking ahead, sulphate prices pulled back somewhat recently, and the pricing of upcoming new orders will hinge on the pace of downstream stockpiling in Q3.