COBALT MONTHLY REVIEW – JANUARY: Metal, salts, hydroxide prices buoyed on solid demand, producers’ firm offers

Moving into 2020, cobalt metal, salts and hydroxide prices have been well supported in January on solid demand and producers’ firm offers, while spot activity in China has slowed since mid-January due to the Lunar New Year holiday and Wuhan coronavirus outbreak.

Monthly average cobalt prices

Price moves
Traders and consumers actively restocking boosted the benchmark standard-grade cobalt prices at the very beginning of January, while tight spot availability is supporting the momentum.

Sellers successfully hiked up offer prices while inquiries from traders and end users continued to mount following market participants’ return from the Christmas and New Year holidays.

An increase in prices for cobalt metal and sulfate in China, as well as a rally in the share price of domestic cobalt-focused companies over the past two weeks bolstered sentiment.

The price of cobalt sulfate in China jumped over 13% in January, with suppliers either offering the material at aggressively high levels or holding back from sales. The urgency to complete year-end book squaring and improved financial constraints – as a result of the equity market rally – offset the uncertainty surrounding downstream electric vehicle battery demand.

Upstream, the strength in the downstream sulfate market and the steady rally in underlying benchmark cobalt prices boosted consumers’ appetite since late December, while producers sat on comfortable inventories and showed little interest in cheaper bids,

Market news
Eurasian Resources Group (ERG) is placing its Chambishi refinery in Zambia on care and maintenance due to the shortage of both copper and cobalt concentrate feedstock material.

In the absence of Chambishi, Compagnie de Tifnout Tiranimine (CTT) in Morocco is the last remaining producer of cobalt broken cathodes, which can be used in the production of cobalt sulfate for battery applications.

In the upstream market, the Deziwa copper-cobalt project in the Democratic Republic of the Congo should achieve fresh production of cobalt between late February and early March. The project is projected to produce about 4,000-5,000 tonnes of cobalt in 2020.