Increased uncertainty in demand, cobalt prices have fallen from their high levels this week

Domestic cobalt prices fluctuate and fall


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According to the cobalt market analysis system of Business Society, the cobalt price on March 26th was 224600 yuan/ton, a decrease of 1.06% from the high cobalt price of 227000 yuan/ton on March 19th last week. The United States has abandoned purchasing reserves of cobalt, and the international cobalt market demand is lower than expected. The rise in cobalt prices has supported a decline, and this week cobalt prices have fluctuated and fallen.


Increased uncertainty in cobalt demand growth


In 2024, the overall domestic economy is in a state of recovery, and the cobalt market is expected to recover. However, there is still uncertainty in the terminal demand for cobalt. The policy supports the development of new energy vehicles, which is beneficial for the consumption of cobalt in the market. However, as the supply of cobalt raw materials increases and the share of lithium iron phosphate is squeezed, the demand for cobalt in the market may be difficult to meet expectations, and the support for the rise in cobalt prices is limited.


According to sources cited by the media, the United States considered purchasing cobalt for defense reserves last year, with the aim of increasing cobalt reserves to reduce dependence on foreign countries. The market expects cobalt prices to drop to $16 per pound, which will stimulate the United States to purchase cobalt reserves. However, cobalt has not been listed as a weak link in the need for reserves, which is unexpected in the market. US cobalt reserves have just decreased in demand, and overall cobalt market demand is lower than expected.


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The import volume of cobalt raw materials increased year-on-year


According to data from the General Administration of Customs, the import volume of cobalt raw materials in January was 69453 physical tons, equivalent to 20938 metal tons, an increase of 32.95% month on month and 133.65% year-on-year. The import volume of cobalt raw materials in February was 44761 physical tons, equivalent to 13585 metal tons, a month on month decrease of 35.12% and a year-on-year increase of 76.26%. The total import volume of cobalt raw materials from January to February was 114214 tons, equivalent to 34523 metal tons of cobalt. From January to February, cobalt raw materials gradually arrived at the port. Due to the impact of the Spring Festival, ship arrivals were delayed, and the overall arrival volume of cobalt raw materials in February decreased. It is expected that the arrival volume of cobalt raw materials in March will increase, with an expected arrival volume of 15000-16000 metal tons.


Overview and Outlook


According to Bai Jiaxin, a data analyst at Business Society, the uncertainty of increasing demand in the cobalt market has increased, and the demand for cobalt reserves in the United States has decreased, resulting in overall lower than expected demand in the cobalt market. In the future, the amount of cobalt raw materials arriving at the port has increased year-on-year, and the supply of cobalt in the market has significantly increased; However, there are still doubts about the degree of recovery in the field of ternary power batteries, the degree of improvement in demand for 3C electronics, and the increase in demand for hard alloys. The demand for cobalt in the market is still uncertain, and it is difficult to determine the increase in supply and demand. It is expected that cobalt prices will fluctuate and fall in the future.

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