Low-grade cobalt inches up on Chambishi transformer blow-out

Low-grade cobalt prices rose on the bottom end towards the end of this week, supported by news of a production cut at major producer Chambishi.

Low-grade cobalt prices rose on the bottom end towards the end of this week, supported by news of a production cut at major producer Chambishi.

The Zambian plant will be operating at 50% of its cobalt output capacity for up to six weeks after the transformer blow-out, owner ENRC confirmed to Metal Bulletin earlier this week.

Although ENRC told Metal Bulletin that it was too early to confirm whether metal would be offered on the spot market while production was reduced, some market participants expect a reduction in spot availability as a result.

 Low-grade cobalt subsequently climbed to $11.50-12.60 per lb, from $11.35-12.60 on Wednesday November 27.

More than one source had raised prices, or planned to raise prices, as a result of the news.

“I'm increasing my prices because of the Chambishi news. There will be a lot of guys who are desperate for material," one supplier said.

“We’d be looking at firming our prices,” a producer said.

One consumer, meanwhile, stated that availability had already been limited this week, and expressed surprise at recent prices, which had been on a losing streak for several weeks

“I’m quite surprised by the price. If you want to buy briquettes, you have to pay quite a premium. Producers say they’re mostly sold out,” the consumer said.

High-grade cobalt, meanwhile, stabilised on Friday November 29, at $11.65-12.75 per lb, on limited spot activity.

This was partly due to Thanksgiving holiday in the USA, where many superalloy makers are based.

And while many hiked their low-grade offers, some sources argued that weakness prevailed.

Limited spot enquiries across the complex had created a “vacuum” in the market, they said.

“If there’s a vacuum like this, someone will rush in and say the price is higher. The truth is, the cobalt world hasn’t changed,” a trader said.

However, no source questioned by Metal Bulletin had completed business, or received an offer below $11.50.

While transacted volumes were thin, reported prices were significantly higher than those reported earlier in the week.

Business was confirmed as high at $12.60 per lb on low-grade and as low as $12.20. Offers were reported as low as $11.50.

Fleur Ritzema 
fritzema@metalbulletin.com
Twitter: FleurRitzema_MB 
 

 



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