[SMM Analysis]Cobalt Market Continued to Diverge, with Severe Losses Across the Industry

Refined Cobalt:
Refined cobalt spot prices continued their weak downward drift this week. Futures fluctuations narrowed, and the market operated steadily overall. Supply side, the firm-pricing sentiment persisted, with mainstream smelters holding ex-factory quotes stable. Traders maintained spot-futures price spreads at parity to a 10,000 yuan/mt premium, with only a few traders offering discounts to accelerate capital recovery. Demand side, the weak pattern continued, as downstream alloy and magnetic material enterprises saw no recovery in orders, maintaining cautious procurement strategies focused on small-batch, high-frequency purchasing as needed to strictly control inventory risks. After prices stabilized at low levels, some downstream enterprises turned more optimistic about the market outlook, with restocking willingness slightly rebounding. In the short term, weak demand continued to suppress prices, while high raw material costs and the reverse dissolution price spread provided solid bottom support. Prices are expected to maintain a fluctuating trend. As downstream demand gradually recovers, refined cobalt prices still have upside room.

Cobalt Intermediate Products:
Cobalt intermediate product prices continued to hold up well this week. Supply side, suppliers had strong willingness to hold prices firm, and miners' participation in market procurement exacerbated spot cargo tightness, with some enterprises maintaining quotes above $26.0/lb. Demand side, downstream purchase willingness recovered slightly, but constrained by cobalt salt prices struggling to catch up, enterprises mostly inquired and waited, with only small-batch transactions in the $25.8-25.9/lb range. It was learned that DRC cobalt intermediate product cargoes remained stranded at South African ports and in transit by land. In April, only a few miners completed small-batch vessel bookings, with arrivals expected in May-June. Affected by tight African shipping, the remaining cargoes are not expected to arrive in China in bulk until July. As downstream orders materialize and restocking demand is released, cobalt intermediate product prices still have upward momentum.

Cobalt Sulphate:
Cobalt sulphate market prices continued their downward drift this week. Supply side, mainstream smelters, supported by production costs, maintained quotes at 94,000-97,000 yuan/mt. Some recycling enterprises and traders, under capital turnover pressure, offered concessions on shipments, lowering quotes to 92,000-93,000 yuan/mt. Additionally, some older cobalt sulphate inventory was transacted at around 90,000 yuan/mt. Demand side, downstream enterprise demand remained sluggish, compounded by sufficient inventory levels, with overall restocking willingness remaining weak and only small volumes of low-priced resources purchased as needed. In the short term, impacted by a small amount of low-priced upstream supply and weak downstream demand, cobalt sulphate prices may continue to be in the doldrums. Once procurement demand recovers, prices are expected to see a corrective rebound.