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Supply and demand are tight, cobalt prices rose nearly 80% in 4 months.


Release time:

2017-02-21

According to data from the Business News Agency, the domestic small metal plate cobalt ingot performed well in February 2017, with prices rising all the way. As of the 20th, the average price of cobalt in the domestic market was 376500 yuan/ton, up 27.99 percent from the average market price of 294166.66 yuan/ton at the beginning of the month. Since the start of the cobalt price rally in November 2016, it has risen 76.35 per cent.

Analysts pointed out that at present, all kinds of mineral products almost show a "V"-shaped rebound, the price correlation between minerals is strong, and the news of the shortage of non-ferrous ore supply interacts with each other, pushing up metal prices.

Overseas cobalt market hot

After the return of the festival, cobalt prices continued the previous hot market, a sharp rise. On the one hand, based on the cumulative rise in external cobalt prices during the Spring Festival and the return of the follow-up continued to soar, foreign media cobalt prices led to a rise in domestic cobalt prices.

Europe, North America, cobalt metal and cobalt oxide market demand is strong, prices have been rising. Foreign media cobalt hit a new high. According to the tracking data of Business News, the price of foreign media cobalt (purity not less than 99.8, MB free market, warehouse delivery) on February 17, 2017 was 20.75-20.9 USD/pound, up 29.35 from 15.6-16.6 USD/pound on January 18. Overseas cobalt prices have exceeded US $20/pound, compared with US $13.6/pound at the beginning of December, up about 50%.

At present, the domestic mainstream production enterprises have low inventories, rising raw material prices, strong cost support, obvious bullish mentality of the industry, increasing inquiries from traders, and rising prices from manufacturers.

Cobalt industry chain price linkage transmission phenomenon is obvious. Cobalt tetroxide prices continued to rise strongly before the festival, cobalt tetroxide prices for 28.0-290000 yuan/ton, the average price than before the festival rose 7-80000 yuan/ton. The prices of cobalt oxide and cobalt powder are strong and rising. Cobalt powder manufacturers are tight in supply. Manufacturers are reluctant to sell. They just need to sell at a high price.

Cobalt salt is affected by the rising factors of raw materials, cobalt sulfate prices rose to 79-83 yuan/kg, cobalt chloride prices 89-93 yuan/kg, are more than 10 points higher than before the festival, but the downstream wait-and-see mainly, to undertake insufficient, the actual transaction is weak.

Lithium cobalt oxide is subject to the upstream four oxide three cobalt price strong, cost factors have a greater impact, the price is also conducted, and downstream battery customers rigid procurement-oriented, the market to wait and see.

Ye Jianjun, a cobalt analyst at the Business Society, pointed out that high overseas prices continued to push up spot quotations for domestic metal cobalt tablets, cobalt salts and derivatives. Although the downstream consumption of the domestic cobalt market has not recovered significantly, the phenomenon of hoarding in the early stage is obvious. Although the recent downstream demand digestion capacity is not strong, the market is under the dual influence of investment speculators and upstream sales control. In addition, the overseas cobalt market is hot for the export of domestic cobalt products, the domestic cobalt market rose rapidly.

Cobalt ore raw material supply tight

The long-term negotiations between ore producers Glencore, Freeport and downstream smelters ended in December, with a discount factor of about 5 percentage points higher than in 2015, and upstream and downstream have reached a consensus on cobalt prices. CATL, as a downstream battery company, was directly involved in the long-order negotiations and signed a long-order supply agreement with Freeport (Luoyang Molybdenum).

According to the analysis of the announcement on the acquisition of indirect rights and interests in world-class copper and cobalt mines issued by Luoyang Molybdenum on the morning of February 20, if the acquisition is completed, it will optimize the industrial chain structure and ease the tension in domestic cobalt mines to a certain extent.

In the early days, Huayou Cobalt Company invested 1.432 billion yuan in the acquisition and development of Congo (DRC) PE527 copper and cobalt mineral rights area, with 368500 tons of copper reserves and 55400 tons of cobalt reserves. After completion, the annual output of copper is 14300 tons and 3100 tons of cobalt. The construction period is 1.5 years and the production period is 0.5 years. It is initially planned that copper and cobalt concentrates will be shipped back to China for sale to Huayou Cobalt and Huayou Quzhou as raw materials, and other products will be sold to CDM smelters for processing. As copper and cobalt prices rise, on the one hand, resource advantages can be used to control costs to a certain extent, and on the other hand, the pressure of price increases can be transmitted downward.

Greenmei, on the other hand, is committed to cobalt recycling capacity, down the three-way battery materials industry chain.

Long single agreement, cross-border acquisition of upstream mining enterprises, strengthen recycling, is a different way to solve the problem of cobalt ore raw material supply, but in a sense aroused the market's expectation of supply shortage.

Ye Jianjun believes that affected by overseas price promotion and capital speculation, coupled with manufacturers' reluctance to sell and control sales, all kinds of cobalt products have been rising since mid-October. Recently, they have been rising repeatedly and the increase has increased. In the early stage, domestic cobalt prices are strongly guided by overseas prices. At present, domestic cobalt prices have covered the increase in foreign media cobalt prices. The recent cobalt market will be to digest the gains, shock stability-oriented.

"Special attention should be paid to the growth of the demand side, especially lithium batteries (new energy vehicles). Under the big concept of new energy development, the relationship between supply and demand is the pressure stone of price fluctuations." Liu Xintian, Secretary General of China Commodity Development Research Center, stressed.