Cobalt Price Will Bring To The Battery Industry

- Feb 28, 2017-

This year, with the rising demand for cobalt downstream and make up the demand for inventory, coupled with the reluctance to sell the consumer sentiment, cobalt prices rose rapidly, according to China Nonferrous Metals Net statistics, February 22, 2017, cobalt reference price of 377,000 yuan / Ton, four months ago on October 22, 2016, metal cobalt offer at 22 million / ton, during which rose more than 70%. February 1 this year, the price of metal cobalt 295,000 yuan / ton, since February has risen about 25%.

"Crazy" cobalt price will bring to the battery industry?

Cobalt prices appear so much rise, nothing more than supply and demand for two reasons:

1. Reduced supply. Since the financial crisis in 2008, the price of cobalt has been lower, from the highest when the 860,000 yuan / ton fell to less than 20 million / ton, a long downturn to many companies in the industry losses or even out; coupled with domestic environmental pressure Day , Limited production capacity.

2. Increased demand. New energy vehicles on the rapid growth in the demand for cobalt is expected in 2020, the global demand for cobalt in 2015 compared to 2015 growth of 10 times! Only 2017 years, there will be a gap of 4000-5000 tons.

First of all, we look at the production capacity of cobalt:

2016 global cobalt raw material production into metal equivalent of about 10.1 million tons, an increase of 3.5%. The impact of copper and nickel ore prices for many years in the doldrums, cobalt ore exploration and development of new investment is limited, and then add more concentrated cobalt ore, Congo (gold) to occupy more than half of resources, political turmoil and child labor on human rights issues, resulting in 2016 Congo production fell by about 10%, dragging down the global slowdown in cobalt supply.

2017 - 2018 cobalt new supply and expansion potential is limited, affecting the market supply of cobalt is mainly the increase or decrease in existing mine production is expected in 2017-2018 are not very large volume of the project put into operation, such as the recent large new Production capacity for the color shares RTR project, the expected capacity of 14,000 tons, is expected to be put into operation in the second half of 2018. Luoyang molybdenum acquisition of Tenke mine is basically full of 16,000 tons, Glencore Katanga and Mutanda production capacity to increase flexibility, after the increase is only 3,000 tons, the overall supply of less impact.

Production of cobalt concentrate over the years (metal equivalent)

"Crazy" cobalt price will bring to the battery industry?

Second, the amount of cobalt demand for the next period there is a lot of room for growth:

Demand mainly in the domestic market-based, adjusted after the new energy vehicle subsidies policy was January 1, 2017 began to implement, in order to obtain higher subsidies, depot as much as possible to require a higher energy density of the battery, the ternary route will be Future trends.