[SMM Cobalt Lithium spot Weekly] impact of African Cobalt Raw material imports Limited Terminal demand restricts Raw material Price recovery (0330-0403)

SMM, 3 April:

Battery and downstream end market: the State Council meeting this week said the policy of subsidies and tax exemption for the purchase of new energy vehicles would be extended for two years, with little response from the market and no increase in the willingness of end consumers in the car market to buy. It is expected that auxiliary local policies may stimulate consumption in the second half of the year. The power market has not yet picked up this week, the car market and power battery factory operating rate is not high, the impact of the global epidemic is large, the car market is expected to improve in April. In the consumer market, the export of terminal consumer products is blocked, many orders are cancelled and delayed delivery, among which power tool products have the greatest impact, and orders are basically reduced by 7-8%. Some digital battery factories did not anticipate export problems, with overstocked inventories in March and expected severe production cuts in April.

Electrolytic cobalt and cobalt hydroxide: electrolytic cobalt prices are flat this week. Prices in overseas markets have fallen further this week as the epidemic continues to ferment prices, domestic cobalt producers are still high prices, and the spot market is dominated by shipments by traders. The market price is relatively strong, but the overseas export orders of downstream alloys and magnetic materials are further lower, and the price of electrolytic cobalt is under pressure. In terms of raw materials, as a result of the emotional impact of the former port ban, overseas cobalt hydroxide suppliers raised the raw material price coefficient. However, in the second half of the week, the South African port announced that it would continue to be open to all kinds of vessels. Domestic smelting enterprises have not yet purchased due to the weak market demand for cathode materials downstream, and the actual raw material prices are more difficult to strengthen. On Friday, SMM electrolytic cobalt prices were 24.4-258000 yuan / ton, and SMM cobalt hydroxide prices were 9.8-10.6 US dollars per pound, both of which were stable from last week. The price of SMM electrolytic cobalt is 24.4-258000 yuan / ton, the average price is the same as last week. The price of cobalt hydroxide in SMM is $9.8-$10.6 per pound, the average price is the same as last week.

Cobalt and nickel salts: cobalt salt prices have fallen slightly this week. This week, the supply and demand of cobalt sulfate power system is relatively balanced. In the first half of the week, the import of cobalt raw materials in Africa is expected to be blocked, and the price of cobalt salt is compressed. However, according to the latest news from South Africa, the import of cobalt raw materials is less affected, and it is expected that the price of cobalt sulfate will be difficult. Cobalt chloride is affected by the falling price of the downstream consumption system and the falling price of cobalt sulfate. This week, the price loosened more and the transaction was sporadic. The price of cobalt sulfate in SMM is 4.45-47500 yuan / ton, the average price is the same as last week. The current price of SMM cobalt chloride is 5.5-58000 yuan / ton, down 1500 yuan / ton compared with last week. The price of nickel sulfate of SMM battery grade is 22500-23500 yuan / ton, which is 500 yuan / ton higher than that of last week.

Cobalt tetroxide: the price of cobalt oxide fell on Thursday. The downstream demand is limited and the trend weakens, cobalt oxide inventory and funds are under pressure, a number of enterprises reduce quotations, deal sporadic; foreign media cobalt prices are still bearish, buyer market bargaining is strong, cobalt oxide prices may continue to fall. The current price of SMM cobalt oxide is 18-185000 yuan / ton, down 10, 000 yuan / ton from last week.

Ternary precursor: the price of the body fell before the yuan on Wednesday. Prices of cobalt and nickel were maintained upstream this week, but demand was weak downstream and precursor manufacturers had to lower their prices. The downstream power market has not yet recovered, while the digital market has been blocked because of the export of terminal products, the number of orders has dropped sharply, and the competition in the precursor market is fierce. It is difficult for the power market to recover in April, the digital market has seen significant declines, and precursor prices are expected to continue to fall next week. The price of SMM ternary precursor (type 523) is 7.4-77000 yuan / ton, down 2000 yuan / ton compared with last week. The price of SMM ternary precursor (622) is 8-83000 yuan / ton, down 2000 yuan / ton compared with last week.

Lithium carbonate: lithium carbonate prices fell this week. Domestic power ternary materials companies slashed production, hitting demand for battery-grade lithium carbonate, which this week cut battery-grade lithium carbonate prices for shipment based on inventory pressure from some ore companies. Consumer battery demand has been affected by the breach of overseas orders, industrial lithium carbonate demand has shrunk, prices are now falling. Based on the expectation of future demand, some lithium salt enterprises will further reduce the operating rate after the festival, Qinghai may have a maintenance plan. This week SMM battery grade lithium carbonate price is 4.5-48500 yuan / ton, the average price is down 1000 yuan / ton from last week. This week, the price of SMM industrial grade zero lithium carbonate is 3.8-41000 yuan / ton, down 500 yuan / ton compared with last week.

Lithium hydroxide: the price of lithium hydroxide is flat this week. Lithium hydroxide export orders do not have a significant impact, domestic high-nickel leading battery enterprises to reduce demand, but material enterprises or prepare inventory for future demand, the range of production reduction is limited. Spot market transactions are sporadic, but with the decline in short-term demand in the battery industry, low prices may be loose after the festival. This week, the price of SMM battery grade lithium hydroxide (coarse particles) is 5.3-59000 yuan / ton, the average price is the same as last week.

Lithium cobalt: the price of lithium cobalt has fallen this week. Consumer battery factory new orders sporadic, affected by the new crown epidemic gradually appeared, the purchase demand for lithium cobalt acid weakened, the price of lithium cobalt acid fell this week; in the short term, the global epidemic has not yet appeared an inflection point, the overall economy is declining, demand remains depressed, and lithium cobalt prices are expected to continue to fall. The price of lithium cobalt sulfate in SMM4.35V is 21-215000 yuan / ton, down 5000 yuan / ton from last week.

Ternary materials: the price of ternary materials fell this week. The price of the upstream precursor continues to decline, orders in the downstream digital market are reduced, the battery factory presses the price on the upstream seriously, and the Sanyuan material factory is forced to reduce the price. Some material factories export more business to Japan and South Korea, European and American car companies may affect the production of battery plants in Japan and South Korea, industry customers expressed concern about the order in April. The power market has not recovered for the time being, the demand for high nickel products also decreased in April, it is difficult to recover downstream demand in the short term, and the price of ternary materials may continue to fall. The price of SMM ternary material (type 523) is 12-127000 yuan / ton, down 4500 yuan / ton compared with last week. The price of SMM ternary material (model 622) is 14.1-147000 yuan / ton, down 3500 yuan / ton from last week.

Lithium iron phosphate: the price of lithium iron phosphate is flat this week compared with last week. Electricity carbon prices fell slightly this week, downstream car market demand for iron lithium has not increased, energy storage market orders have increased, iron lithium prices temporarily stable. It is expected that the new 5G base station project will open in April, and the demand for lithium iron will increase steadily. This week, the price of SMM lithium iron phosphate (power type) is 3.9-42500 yuan / ton, the average price is the same as last week.

Lithium manganate: the price of volumetric lithium manganate is flat this week compared with last week. Electricity carbon prices fell slightly this week, lithium manganate enterprises use more labor carbon production, the price remains unchanged. Exports in the downstream consumer market were restricted, leading to a decline in new orders for lithium manganate companies in April, as industry customers worried that if the global epidemic was difficult to improve in the short term, output was severely damaged in the second quarter, or overall performance was worse than in the first quarter. Some enterprises have begun to slightly reduce the price of shipments, other manufacturers are still in a wait-and-see state. This week SMM lithium manganate (volume) price is 2.15-30500 yuan / ton, the average price is the same as last week. This week, the price of SMM lithium manganate (power type) is 3.45-36500 yuan / ton, the average price is the same as last week.

Future forecast:

Cobalt, South African ports announced that it will continue to open to all kinds of ships, domestic smelting enterprises due to the weaker market demand for downstream cathode materials have not yet been procured, the actual raw material prices are difficult to strengthen. The price of lithium salt is greatly affected by the terminal demand, and the pressure is obvious. As terminal demand is difficult to improve in the short term, the industry's response to subsidy policies is relatively cold, and it is difficult for raw material prices to recover in a short period of time.

SMM Battery Materials Research team

Hu Yan 021-51666809

Qin Jingjing 021-51666828

Mei Wangqin 021-51666759

Huo Yuan 021-51666898

Wuyang 021-51666818