With the recovery of the downstream new energy industry, the market expectation is good. Recently, lithium material prices represented by lithium hexafluorophosphate have shown a trend of bottom recovery, and “inventory liquidation” and “hard to supply” news have been released.
However, as a new energy battery material that has attracted much attention in the early years, the recovery trend of cobalt commodity price is not obvious at present.
In 2018, driven by the concept of new energy vehicles, the price of cobalt metal, one of the important positive electrode materials for ternary lithium batteries, soared to 600,000 yuan/ton, which was nicknamed “Cobalt God” by the market.Since then, however, the cooling of the new energy concept has also contributed to the low cobalt price, and since 2020, cobalt ore and related commodity prices have remained low.
“Cobalt prices this year are basically in the range of 200,000 yuan to 300,000 yuan/ton, far from the high in 2018.”Han Minhua, analyst at Zhuochuang, said that while cobalt prices were hardly strong, prices for products related to new energy batteries were also flat.Ternary battery materials are cobalt sulfate products, and do 3C products of lithium cobalt oxide upstream for cobalt oxide.At present, the cobalt sulfate price is 53-57,000 / ton, and the cobalt oxide price is 200,000 to 225,000 / ton, both of which are relatively low in history.
“The prices of cobalt salts in the upstream of batteries, such as cobalt sulfate and cobalt oxide, have been relatively strong recently, while the prices of other cobalt products are more difficult to be optimistic.”CBC cobalt analyst Zhao Chao told the Securities Times · E Company that although cobalt salt prices have been relatively firm since the end of September, electrolytic cobalt prices have declined since September as a whole.In August, the market electro cobalt price rose to 310,000 yuan/ton after receiving a boost from the State Reserve Bureau’s electrolytic cobalt purchase, but has since fallen back as the good news has waned.
According to CBC data, in early September 2020, domestic Co:≥99.8% electrolytic cobalt price was 280 yuan/kg, while on November 3, the average price of the commodity was around 270 yuan/kg.Before the overseas cobalt price continued to be higher than that of the domestic market, but in the context of the current overall weak demand in the market, the domestic and foreign electro-cobalt price gap has basically leveled off. Recently, the foreign electro-cobalt price has reached 259-260 yuan/kg.
SMM data also shows that cobalt prices experienced twists and turns in 2020 due to the impact of the epidemic.Since August, the cobalt price has gradually recovered to the level since the beginning of the year. In September, the price fluctuated slightly, but remained stable. According to the survey, the average daily price of electrolytic cobalt was 270,000 yuan/ton as of October 30.
“At present, the price of electrocobalt is generally about 260,000 yuan to 270,000 yuan/ton, and the cost line tends to be about 260,000 yuan/ton, which is already a low price.And the downstream for alloy cobalt powder enterprises is the cost of hanging upside down.Cobalt powder raw material is cobalt carbonate, the raw material is 300 yuan/kg, but the lowest price in the market has reached 285 yuan/kg.”Zhao Chao told the reporter of Securities Times · E Company that although the downstream of cobalt has been supported by ternary battery and 3C concept recently, the overall demand is still not good and the price trend is weak.The upstream cobalt products of new energy batteries such as cobalt sulphate have relatively strong prices while the actual market transaction price is lower than the quoted price.
When the relevant person in charge of a listed company in the domestic cobalt industry chain communicated with the reporter of Securities Times · E Company, he also pointed out that the profit margin of cobalt-related smelting enterprises is really low and the profitability is not strong.While current cobalt prices are off the lowest cost range and associated copper prices have recently been high enough to be acceptable to upstream producers, some lower-grade miners and smelters are also relatively affected by lower commodity prices.
He admits that the market is more or less worried about cobalt’s technical path.While tesla’s “cobalt free” is a gimmick, the market will take it into account and worry that demand will weaken later.In addition, the development of nickel and cobalt associated mines in Indonesia in recent years may lead to more cobalt output in the future than that of copper and cobalt associated mines, which may lead to a potential increase in market supply and a vague sense that this supply will change the cobalt market pattern.
“Although the resumption of work in the second half of this year is positive, the overall weakening of overseas demand still affects the cobalt price. At present, the overall cobalt product supply and demand are not flourishing.At present, the market terminal sales can be, but the intention of replenishment is not strong, downstream dare not take a large number of goods.”The market had expected a strong replenishment in September and October, but the replenishment in both the upstream and downstream is more cautious, rather than three to five months of stock.”
“Cobalt is different from lithium.The most important downstream of lithium salt is batteries, while the downstream of cobalt is relatively extensive, which is used in addition to batteries, alloys and ceramics, so it is not particularly obvious to be pulled by the demand of new energy batteries.In addition, cobalt due to involve futures electronic disk, the market speculation speculation, by the news surface impact.”This year is affected by the ‘cobalt free’ news, the market hype atmosphere has diminished, coupled with the market demand is really not good this year, so the price pressure.”While supplies of cobalt have also shrunk this year, demand has fallen even more, Mr Han said.Affected by the epidemic this year, many overseas industries have not recovered, and domestic demand for new energy vehicles has picked up slightly in the past two months, and the overall demand is relatively weak.At present, the inventory of domestic traders is still high, although smelters want to hold the price, but the willingness of traders to sell at a low price is strong, the price is difficult to go up.
“The cobalt market is a far cry from the last two years.”Referring to the future trend of cobalt price, the relevant person in charge of the listed company of the cobalt industry chain thinks that although the fourth quarter is the traditional peak season, the Demand for the Spring Festival will weaken again.Cobalt prices have hovered around their current position for so long that it is hard to see a big change in the fourth quarter.From an optimistic point of view, the low cobalt price is favorable for enterprises to focus on operation, control costs and benefit related enterprises in the long term. However, in the short term, cobalt price remains neutral in the market.
Zhao Chao believes that the power battery and 3C market demand is stable, under the operation of low inventory of cobalt salt, especially under the current durban port capacity constraints, cobalt raw material supply is tight or continuous, cobalt raw material suppliers deliberately raise the price, cobalt price is expected to remain strong in the short term.
“Cobalt is supported by new energy demand, so it won’t fall too much later, but it won’t surge either.”Han minhua also believes that the current cobalt inventory is high, overseas demand is still weak, and there is no obvious positive factors in the market, so the price may remain low. The market trend next year, we still need to pay attention to the change of overseas market demand.
In the first three quarters of this year, China supplied 27, 000 tonnes of metal with cobalt sulphate, down 17 per cent from a year earlier, according to SMM.Mainly due to the impact of the epidemic at home and abroad in the first half of the year, the production and sales of downstream terminal new energy vehicles have been hit hard, with a sharp drop in demand and a reduction in cobalt sulfate orders. Despite the gradual recovery of orders in the second half of the year, the overall supply is still down on a year-on-year basis.In the first three quarters, China supplied 48,000 physical tons of cobalt oxide, up 14 percent year on year.The demand for lithium cobalt oxide and cobalt tetroxide increases mainly due to the 5G trend, which promotes the capacity and voltage of terminal mobile phones.
SMM said its forecast for the fourth quarter suggested that cobalt sulphate supply may still decline year on year, despite a gradual pick-up in downstream demand, as price pressures and the relocation of a new domestic smelter affect production.Cobalt oxide supply is expected to increase in the fourth quarter compared with the same period last year, but the marginal increment may decrease compared with the first three quarters, mainly considering that the fourth quarter is the low season for downstream procurement.Combined with the current smelter raw materials high cost support, smelting products short supply structure, the cobalt price is expected to be strong in the fourth quarter.
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