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Sentiment at the CDI conference this month was upbeat amid an anticipated cobalt supply shortage. Here is a summary of the things we learned.
1. Most market participants expect higher cobalt prices before the end of this year. Major traders see prices at $13.50-15 per lb if Chambishi Metal resumes production at the end of June, and at $14-16 per lb if the closure lasts longer.
2.Closure at Chambishi may last for “at least” three months and may last longer than expected, according to sources. Some market participants are predicting a permanent shutdown of the operation.
3. China’s cobalt metal imports have been low this year, with ENRC not supplying on a long-term basis due to the closure at Chambishi. Ambatovy, meanwhile, is selling robust volumes around the world.
4. Jinchuan Group is planning to reduce its cobalt metal output by about 16% to 3,200 tonnes this year, according to an official heading Jinchuan’s nickel and cobalt operations.
5. China’s cobalt consumption is expected to rise by 13% to about 4,300 tonnes this year, according to an Antaike analyst.
6. Chinese cobalt refiners are sharply increasing production for cobalt-containing tertiary material this year, thanks to robust demand from the battery sector.
7. Battery makers in South Korea and Japan have both reported solid demand from the automobile sector, with one major Japanese company expecting a surge of 70% in battery demand over the next two years.
8. A new cycle of undersupply in cobalt “is about to begin”, thanks to steady growth in the battery sector, CRU consultant Peter Searle told delegates.
Linda Lin Linda.lin@metalbulletinasia.com