This week, the price trend of cobalt market series products is differentiated, and electrolytic cobalt is driven by some rumors in the market to the emotional side, and the price sentiment of electrolytic cobalt companies is heavier, driving its price to rebound. However, on the other hand, in terms of cobalt salts, it still failed to escape the downward trend...... SMM has compiled the price changes of related products in the cobalt market this week, as follows:
Electrolytic cobalt:
According to the SMM spot quotation, this week's electrolytic cobalt quotation stopped falling and rebounded, rising 5,000 yuan/ton in a single day on May 16, as of May 17, the spot price of electrolytic cobalt rose to 19.5~235,000 yuan/ton, with an average price of 215,000 yuan/ton, an increase of 2.38% from May 10.
As for the reason for the rise in electrolytic cobalt prices against the trend, SMM believes that it is mainly due to some rumors in the market during the week, which drove electrolytic cobalt companies to raise prices, and superimposed factors such as tight supply of head goods, which jointly pulled up cobalt prices. From a fundamental point of view, on the supply side, the overall electrolytic cobalt output has maintained a slight increase due to the increase in the output of some enterprises; From the perspective of downstream demand, the actual purchase of terminals is relatively limited, and the recovery of demand is delayed.
Cobalt salts (cobalt sulphate and cobalt chloride):
As of May 17, the spot price of cobalt sulfate temporarily stabilized at 3~31,000 yuan/ton, with an average price of 30,500 yuan/ton, down 300 yuan/ton or 0.97% compared with May 10.
In terms of cobalt chloride, the price of cobalt chloride fell slightly by 250 yuan/ton in a single day on May 14 this week, and as of May 17, its spot price temporarily stabilized at 3.7~37,500 yuan/ton, and the average price was reported at 37,250 yuan/ton, down 0.67% from May 10.
As for the reasons for the decline in cobalt salt prices, SMM believes that it is mainly due to the fact that some companies have a certain amount of over-falling and trading behavior dragged down by weak demand. Specifically, on the supply side, due to the impact of cost inversion and weak demand of cobalt salt enterprises, the output of cobalt salt has decreased. From the downstream demand side, the production of precursors and cobalt tetroxide has declined, resulting in weakened demand for cobalt. From the perspective of the market situation, due to the continuous decline in the price of cobalt salt, the demand for direct procurement at the end of the terminal is more cautious, and only some traders have a certain low-price bottom-buying behavior.
In terms of cobalt tetroxide:
According to the SMM spot quotation, the spot price of cobalt oxide fell in the first two trading days of this week, as of May 17, the spot price of cobalt tetroxide temporarily held stable at 125,000 ~ 128,000 yuan/ton, and the average price was reported at 126,500 yuan/ton, down 1.17% compared with May 10.
From a fundamental point of view, on the supply side, due to weak downstream demand, the output of cobalt tetroxide has also decreased compared with before; On the demand side, lithium cobalt oxide production is declining, and demand is weakening. Therefore, from the perspective of the overall market situation, due to the small market circulating demand, the spot price of cobalt tetroxide is difficult to support, and the price continues to decline.
On the news side, recently, the Jiangxi Provincial People's Government issued a notice on "Several Measures to Promote the High-quality Development of the Lithium New Energy Industry Chain in Our Province". The notice proposes to continue to track the development trends of the lithium battery industry and strengthen the monitoring of the operation of the lithium battery industry's production capacity and investment. Guide upstream and downstream enterprises to strengthen the connection between supply and demand, and promote the formation of a stable and efficient coordinated development mechanism. Strengthen the prediction of the international lithium resource situation and risk early warning, rationally allocate overseas mineral resources, and disperse the concentration of imported resources. Encourage powerful enterprises to "go global", and support enterprises to invest in key resources such as lithium, cobalt, nickel and smelting projects at home and abroad. Increase the investigation and exploration of lithium resources in the province and improve the supply capacity of lithium resources in our province. Guide mining enterprises to improve the mining recovery rate, beneficiation recovery rate, and comprehensive utilization rate, and strengthen the comprehensive utilization of common and associated mineral resources.
In addition, Tengyuan Cobalt, one of the leaders in the domestic cobalt industry, also responded on the investor interactive platform that the Ganzhou Tengchi (Phase I) 40,000-ton ternary precursor and 10,000-ton cobalt tetroxide project has started construction in December 2022, and the first phase of the 20,000-ton ternary precursor and 05,000 tons of cobalt tetroxide production line has entered the trial production stage.
According to the company's 2023 performance report, the company will achieve a total revenue of 5.543 billion yuan in 2023, a year-on-year increase of 15.47%; net profit attributable to shareholders of listed companies was 378 million yuan, up 37.74% year-on-year.
According to public information, Tengyuan Cobalt is mainly engaged in the research and development, production and sales of cobalt, copper, nickel and lithium products, and is one of the world's leading cobalt and copper production enterprises. The company's core products are cobalt chloride, cobalt sulfate and other cobalt salts, electrowinning cobalt, electrowinning copper, etc. The company added electrowinning cobalt products in 2022, and under the company's mature cobalt smelting system, electrowinning cobalt was quickly recognized by core customers at home and abroad after its listing. In the announcement, Tengyuan Cobalt mentioned that due to the increase in the company's production line, the output and sales of cobalt and copper have increased significantly; Copper inventories increased by 510.27% over the previous year, mainly due to an increase in the ending balance due to an increase in production, and an increase in the ending inventory due to the production and sales ratio of 99.18% in 2023, a slight decrease from 103.34% in 2022. At the same time, in 2023, the company will add new nickel and lithium product lines.
In an interview with investors, Tengyuan Cobalt was asked how to view the future trend of copper and cobalt, to which Tengyuan Cobalt replied that the company continues to be optimistic about the prospects of the copper market. First of all, with the rapid development of artificial intelligence and big data technology, it is expected that these fields will indirectly consume 3%-5% of the world's copper resources; The second is infrastructure construction, the implementation of large-scale infrastructure projects in various countries, including the upgrading of power grids and the development of the new energy vehicle industry, will further increase the demand for copper; Finally, there is the relationship between supply and demand, the current supply of copper is relatively tight, so in the long run, the company is optimistic about the prospects of copper.
The company's cobalt products are mainly used in new energy, consumer electronics, aerospace and military industries. Demand side: the global new energy vehicle market has huge incremental space; Major manufacturers in the consumer electronics market continue to introduce new products, and VR/AR, AI smart home and other fields are also rapidly iterating; Superalloys and cemented carbides are also becoming more and more extensive in the aerospace and military market.
On April 18, Tengyuan Cobalt also said that the current price of cobalt is close to the cost price of the mine, if the price tends to stabilize, it is a good thing for the market and the company.
And it is worth mentioning that due to the associated effect of nickel and cobalt, Indonesia's laterite nickel ore has brought out part of the cobalt, and for the impact of this part of the cobalt on the overall cobalt price, Tengyuan Cobalt said that the current supply of cobalt brought out of Indonesia's laterite nickel ore is small, which has little impact on the global supply of cobalt, and the mainstream of market supply is still concentrated in the Democratic Republic of the Congo (DRC).
On the demand side, at SMM's Li-ion Battery Americas 2024 Agenda conference in Las Vegas, USA, Minviro Founder and CEO Dr. Robert Pell expects global demand for battery raw materials such as lithium, nickel and cobalt to grow 15-20 times between 2020 and 2050. The sourcing of sustainable and reliable battery raw materials is complex. The extraction and primary production of galvanic cell materials used in battery chemistry have different impacts on the environment.
On the supply side, Wang Cong, general manager of the new energy division of SMM Industry Research Institute, said that according to SMM research, the total global supply of cobalt raw materials in 2023 will be 248,000 tons of metal, of which the total supply of primary raw materials will be about 233,000 tons, mainly concentrated in the Democratic Republic of the Congo, Indonesia, Australia, Canada and other regions. Looking ahead, in terms of global cobalt resource supply, SMM expects the global cobalt raw material supply to grow at a compound annual growth rate of about 14% from 2022 to 2027.