[SMM Analysis] China's August refined cobalt production up 11.02% MoM, demand recovery still under watch

According to an SMM survey, China's refined cobalt production in August 2026 was 655 mt, up 11.02% MoM and down 68.28% YoY. Of this, production using cobalt chloride as raw material accounted for about 56%, and production using cobalt sulphate as raw material accounted for about 44%.

The increase in refined cobalt production in August was mainly due to top-tier smelters further raising their production schedules, while a long-established smelter that had previously suspended production resumed operations. In terms of the growth structure, top-tier players contributed most of the monthly increase, with the resumed producer also adding some supply; however, some small and medium-sized enterprises saw production decline due to costs and orders, offsetting part of the new supply. Currently, domestic refined cobalt production remains concentrated among a small number of enterprises, with top-tier players accounting for nearly 70% of total output, so changes in any single enterprise's production schedule have a notable impact on the monthly total.

On the price side, refined cobalt spot prices remained weak overall in August. The SMM average refined cobalt price fell from about 345,500 yuan/mt at the beginning of the month to about 305,000 yuan/mt at month-end, a decline of about 11.7% during the month; the August monthly average was about 321,700 yuan/mt, down about 12.6% MoM. At the start of the month, overseas cobalt prices weakened, and domestic cobalt intermediate product and cobalt salt prices fell in tandem. Bearish market sentiment intensified, and some suppliers sold at lower prices, driving the spot transaction center steadily lower. In late August, news of overseas mining interests purchasing low-priced intermediate products provided some boost to market sentiment, and prices briefly stopped falling and rebounded, but spot transactions remained primarily need-based, limiting the extent of the rebound.

On the demand side, August remained a traditional consumption off-season for refined cobalt, with some downstream enterprises in their summer break. Procurement consisted mainly of long-term contract cargo pick-ups and small amounts of need-based restocking, while spot order transactions were relatively sluggish. With no significant improvement in demand, the continued rebound in smelting-side production put some pressure on spot prices. However, domestic refined cobalt production remains significantly lower than the same period last year, with cumulative production from January to August down nearly 90% YoY, so although supply is recovering at the margin, the overall scale remains at a low level.

Looking ahead, with top-tier players maintaining high production schedules and resumed producers gradually stabilizing operations, China's refined cobalt production is expected to increase by about 10% MoM in September. On the demand side, downstream buyers may have some restocking needs after the summer break ends, but no signs of concentrated procurement have emerged yet. In the short term, refined cobalt prices are expected to consolidate at lows, with mine-side price support potentially providing some floor, but continued supply increases will limit the room for price rebounds. Going forward, attention should be paid to the actual strength of downstream peak-season stockpiling, as well as changes in overseas cobalt raw material prices and purchasing activity.

SMM New Energy Research Team

Wang Cong 021-51666838

Ma Rui 021-51595780

Feng Disheng 021-51666714

Lyu Yanlin 021-20707875

Xiao Wenhao 021-51666872

Zhang Haohan 021-51666752

Wang Zihan 021-51666914

Wang Jie 021-51595902

Xu Yang 021-51666760

Yang Lianting 021-51595835

Wang Zhaoyu 021-51666827