Fastmarkets monthly BRM market update

Key points

1. Lithium prices face sustained declines
   Lithium prices remain under extreme pressure as the downward trend dives deeper into the cost curve. Lithium carbonate exw China prices fell to a low of RMB 59,650 per tonne on 29 May, down 10.3% from the end of April level of RMB 66,500 and down 20.3% from the start of the year (RMB 74,900 per tonne). With no signs of improving fundamentals, we anticipate continued downward pressure on prices. The low in 2020 was RMB 39,000.
   

2. Spot spodumene prices continue sharp decline
   Spot spodumene prices cif China had fallen to a low of $612.50 per tonne on 3 June, down 19.1% from the end-of-April price of $757.50, and down 30% from start-of-year prices ($875). The low in 2020 was $375 per tonne.
   

3. Falling salt prices add pressure on spodumene producers
   Spodumene prices did pick up after last year’s production cuts, but as salt prices in China failed to rebound, the ongoing fall in salt prices has squeezed processors’ margins. This has meant that spodumene producers and traders have had to lower their offer prices to sell spot material. The pace of the spodumene price fall accelerated in May. Prime candidates for additional cuts are higher-cost Australian miners and African projects – who will blink first?
   

What do our analysts say?

EV sales remain healthy, so at first sight, the weakness in lithium prices is all about oversupply, and it seems prices have not fallen far enough yet to trigger another round of cutbacks. But while EV demand has been healthy, news that China’s use of battery energy storage systems (ESS) declined for the first time in three years during the first quarter of 2025 is another worrying development that is likely to weigh on sentiment further. Newly installed battery ESS capacity reached 5.03 gigawatts in January-March 2025, a year-on-year decline of 1.5%, according to the China Energy Storage Alliance (CNESA)..

William Adams, Fastmarkets

Key points

1. Uncertainty lingers over DRC cobalt hydroxide exports
   The market remains unclear on what happens next for cobalt hydroxide exports out of the DRC. Market participants gathered in Singapore last month expecting some details to be shared, but little in terms of public announcements was provided.
   

2. Cobalt prices weaken amid supply uncertainty
   Despite the uncertainty around cobalt intermediate availability, prices saw weakness in May, with the standard-grade cobalt metal, exw China cobalt metal, and cobalt sulphate exw China prices all trading lower through May.
   

3. China’s metal trade surged in April
   April trade statistics for China’s metal flows showed major increases in both imports and exports. China imported 840 tonnes of metal in April, up 60% month on month. Indonesian metal accounted for 80% of this total. This could prove a useful supply source, with refiners in China reportedly running cobalt metal rates at 20-30% in May. In the same month, China exported 4,086 tonnes of metal, up 202% year on year. This figure highlights the large-scale stocks that metal refiners still have on hand and was likely the driver behind weakening seaborne prices.
   

What do our analysts say?

The much-anticipated announcement from the DRC government and mining delegates in Singapore last month left a fair bit to be desired in terms of outlining the roadmap for what comes next for cobalt hydroxide exports. For now, the messaging appears to be to hold on until June 22. Despite lobbying from Chinese miners and refiners to end the ban, we are still no closer to knowing what the supply of cobalt intermediates will look like for the remainder of the year.

Rob Searle, Fastmarkets

Key points

1. LME nickel cash price sees further decline
   The LME nickel cash price remained in the doldrums in May, falling by a further 1.6% over the month and ending at US$15,105 per tonne.
   

2. US tariff policy uncertainty pressures nickel prices
   Uncertainty regarding the United States’ tariff policy weighed on the nickel price for several months.
   

3. Market oversupply continues to pressure nickel prices
   Market fundamentals are also weighing on the nickel price. The market remains heavily oversupplied in early 2025, and we expect another full-year surplus.
   

What do our

analysts say?

It is difficult to see any near-term bullish narrative for nickel. Data released by the International Nickel Study Group highlighted that the market remained heavily oversupplied in the first quarter of the year, and indeed Fastmarkets forecasts another full-year market surplus. Fundamentally, this oversupply is due to strong production growth rather than any weakness in demand. Therefore, for the nickel price to stage a meaningful and sustainable rally, greater supply discipline is required, including from Indonesian and Chinese producers.

Olivier Masson, Fastmarkets

Key points

1. Manganese sulphate prices rise on renewed restocking
   Manganese sulphate prices in China turned bullish in the second half of May due to restocking. Prices had previously been tracking movements in the high-grade manganese ore market, but price directions differed between these commodities in recent weeks.
   

2. Manganese sulphate production boost supports spot prices
   The improvement in spot prices also followed an uptick in manganese sulphate production in China. In March, operating rates in China rose to 38%, before falling marginally to 34% in April.
   

3. Gabon’s manganese export ban challenges China’s supply chain
   In early June, Gabon announced plans to ban manganese exports from 2029. China is a major importer of Gabonese high-grade manganese ore, with one Chinese producer of manganese sulphate vertically integrated with mining operations in the country.
   

What do our analysts say?

The manganese sulphate spot market started to show signs of life in the second half of May, with prices firming despite ongoing weak sentiment in the high-grade manganese ore market. For now, we believe this to be restocking rather than a significant uptick in demand for NCM pCAM in China. Going forward, the market will continue to monitor developments in the cobalt market to determine where China’s NCM pCAM producers target production.

Rob Searle, Fastmarkets

Key points

1. Temporary pause in trade wars fuels EV sector uncertainty
   We are seeing at least a temporary reprieve in the US-China trade war, with reciprocal and retaliatory tariffs from both countries paused to enable further negotiations. However, the vast uncertainty surrounding tariffs in the US is expected to have a significantly negative impact on demand across the EV and battery raw materials sector, including graphite. US government negotiations around the ‘One Big Beautiful Bill’, passed by the House of Representatives and currently being assessed by the Senate, are prompting additional uncertainty for EV and battery manufacturers. 
   

2. Synthetic graphite tariffs drive rising costs for US consumers
   While natural graphite is exempt from the universal and reciprocal tariffs as a critical mineral, synthetic graphite is not. Until August 12, when the 90-day pause ends, US import tariffs on Chinese synthetic graphite will remain at 55%, comprising the 25% Section 301 tariff, the 20% IEEPA tariffs, and the 10% universal tariff. US consumers of synthetic graphite from China will imminently face significantly higher costs, as Chinese producers are not expected to absorb the full extent of the tariffs.
   

3. Graphite market faces bearish outlook amid weak demand
   Fastmarkets’ outlook for the graphite market is increasingly bearish in response to the global trade war and the expectation of significantly slower US demand amid vast uncertainty. Graphite prices remain at or near multi-year lows. Persistently high inventories throughout the supply chain, combined with sluggish demand from both the battery and steel sectors, as well as excessive synthetic graphite supply, are all contributing to weak graphite prices.
   

What do our analysts say?

Uncertainty on numerous levels continues to plague the graphite market, leaving prices at record lows and doing little to encourage the needed investment in diversifying the supply chain away from reliance on China. News that Syrah and Tesla may exit their anode offtake agreement if Syrah’s material fails to qualify by February 2026 further highlights the challenges of developing an ex-China supply chain. US tariff and policy uncertainty discourages business investment and complicates access to much-needed project financing. 

Amy Bennett, Fastmarkets

Key points

1. Lithium price slump pressures recyclers and producers
   Weak prices in the lithium market have continued to make recyclers nervous, unlike the mature primary lithium producers operating at scale. The added complexity of separating and purifying lithium from black mass means hydrometallurgical lithium producers are struggling with profitability, with Fastmarkets reporting that lithium carbonate prices are lower than the cost of production.
   

2. Hydromet recyclers struggle with low manganese prices
   Hydromet recyclers face significant challenges as recent announcements from GM and Ford on future cathode chemistry indicate the West may begin to look toward lithium manganese-rich cathodes. As it stands, Fastmarkets has heard that the price of manganese is so low that most secondary source hydromet recyclers are opting not to refine the manganese from black mass into electrochemical-grade sulphate but instead sell it as a low-grade product. This casts doubt on their current ability to adapt to increasing manganese content in cathodes.
   

3. Cobalt price recovery sparks black mass demand growth
   Despite the uplift in cobalt from late February, overall metal prices remain historically weak. This has caused strong demand for black mass in a market with already limited feedstock supply, as recyclers seek to lower their OPEX costs (per tonne) by increasing utilisation rates.
   

What do our analysts say?

The last month has seen a market characterised by weak metal prices and high demand for black mass, particularly from the established South Korean and Southeast Asian hydromet refiners, which are keeping utilisation rates high to lower their OPEX per tonne. The limited supply of battery scrap, from both production and end-of-life, means there is excess demand for feedstock throughout the whole market. This limited supply, combined with high demand to keep utilisation rates high, has led to a market running hot for both black mass and feedstock.

Luke Sweeney, Fastmarkets

EV demand continues to grow significantly despite sentiment remaining broadly negative. May saw sales in China grow by 30% year-over-year, while the UK and Germany continue to lead growth in the European market. Unfortunately, we are beginning to see the effect of US tariffs on broader vehicle demand, as US port activity experiences its largest monthly fall since the beginning of Covid-19 pandemic restrictions.

Key points

1. Chinese EV sales normalize with 1.06 million sold in May
   Chinese EV sales have returned to slightly more normal growth rates following the end of distortions from the Lunar New Year period. May saw 1.06 million EVs sold in China, reflecting 30% year-over-year growth and surpassing 1 million sales per month. Year-to-date growth relative to 2024 now stands at 34%, matching the full-year growth rate observed in 2024.
   

2. BYD’s global sales triple, boosting profit margins
   BYD’s efforts to expand its international footprint have started to deliver results since the beginning of the year, with international sales tripling from less than 30,000 per month just six months ago to 90,000 in May this year. International sales now contribute more significantly to BYD’s profit margin, especially as it continues to escalate China’s ongoing price war, prioritising market share over profit.
   

3. Ford and GM shift battery strategies amid market challenges
   May saw both Ford and GM announce moves away from relying solely on high-nickel batteries in their future vehicle line-ups. Strategic shifts in battery chemistry at this stage signal turbulence in the US market and highlight the need for US companies to hedge against potential trade disruptions affecting supply chains.
   

What do our analysts say?

Considering new policies from the US administration and dwindling pre-tariff inventory within the country, May was likely the final month of year-over-year demand growth we will see for the rest of this year in the US market.

Connor Watts, Fastmarkets

Key points

1. Technological innovation drives ESS growth and modular efficiency
   As of 2025, the ESS industry is advancing on multiple technological and architectural fronts. Lithium iron phosphate (LFP) remains the dominant chemistry, with ongoing improvements such as increased cell capacities enhancing energy density and overall system performance. At the same time, a diverse range of emerging battery technologies—including sodium-ion, flow batteries, lithium manganese iron phosphate (LMFP), and solid-state batteries—are being actively explored by industry leaders. Sodium-ion batteries are increasingly viewed as a cost-effective and sustainable alternative for stationary energy storage applications. While they are not yet more economical than LFP, their long-term cost advantage is promising. Companies like CATL plan to begin mass production of sodium-ion batteries by the end of 2025, signalling strong momentum behind this technology. 
   

2. Policy rollbacks threaten US energy storage progress
   The passage of the “One Big Beautiful Bill” by the U.S. House of Representatives in May 2025 introduces significant policy reversals that could adversely impact the U.S. energy storage sector. If enacted, the bill would dismantle key incentives established under the Inflation Reduction Act (IRA), undermining investment confidence and slowing the transition to a clean, resilient energy grid.
   

3. Global regulations emphasize ESS safety standards
   The introduction of GB 44240-2024 in China and UL 9540A-2025 in the U.S. underscores a global regulatory shift towards prioritising safety in the rapidly growing energy storage industry. While each regulation has a distinct focus—comprehensive lifecycle safety in China and fire propagation testing in the U.S.—they all converge on one critical principle: ensuring the safety of energy storage systems is essential not only to protect lives and infrastructure but also to sustain long-term market growth, public trust, and regulatory compliance. As ESS deployments scale in size and complexity, robust safety standards are no longer optional—they are foundational.
   

What do our analysts say?

As of 2025, the ESS industry is evolving rapidly, driven by advancements in lithium iron phosphate (LFP) technology and emerging alternatives like sodium-ion batteries, with companies such as CATL leading mass production efforts. Modular, high-capacity system designs are enhancing deployment flexibility and efficiency. However, policy uncertainties, exemplified by potential rollbacks of U.S. incentives under the ‘One Big Beautiful Bill,’ threaten to slow domestic energy storage growth by increasing costs and weakening supply chains.

Walter Zhang, Fastmarkets

Key points

1. Lithium prices drop further amid weak market fundamentals
   Lithium prices have continued their downward trend, with the lithium carbonate exw China April mid-price averaging 9% lower than in January. The most recent daily low price is approaching 64,000 yuan per tonne, and with no signs of improving fundamentals, we anticipate continued downward pressure on prices.
   

2. Spodumene prices plunge, threatening industry stability
   Under pressure from falling salts prices, spodumene prices have continued their downward spiral, with the latest low hitting $730 per tonne, a level not seen since October 2024. This price is below the level at which several Australian producers announced production cuts or placed operations on care and maintenance last year, citing harsh market conditions. As prices edge closer to the anticipated $700 per tonne mark, we are likely to witness further casualties in the industry.
   

3. Higher-cost miners face pressure amid call for production cuts
   Despite last year’s production cuts, it is increasingly evident that further producer restraint is essential to halt the current price decline and allow demand to catch up with supply. Prime candidates for additional cuts are higher-cost Australian miners and African projects that looked attractive at 2022 lithium prices but are now facing significant cost pressures due to low concentrate grades and high transportation costs.
   

What do our analysts say?

In a market flooded with excess supply and record-high inventory levels, consumers are holding off on spot purchases until prices stabilize. On top of rock-bottom market sentiment, global economic uncertainty arising from US tariffs and recent announcements of major breakthroughs in the performance of sodium-ion batteries will further add to the industry’s concerns.

Paul Lusty, Fastmarkets

Key points

1. Cobalt export ban in DRC persists
   The cobalt export ban remains in place in the DRC, with limited news coming out of Central Africa on the progress of talks and negotiations between miners and the government.
   

2. Cobalt prices hold steady at $15-16 per lb
   Since the major gains in March, prices have stabilized, with standard-grade cobalt metal prices rangebound at $15-16 per lb.
   

3. March sees surge in cobalt imports, decline expected by May
   China’s import stats showed high volumes of cobalt hydroxide entering the country in March. We expect shipments already en route to continue to arrive in April before seeing a significant drop-off in May to August.
   

What do our analysts say?

For now, the cobalt market appears to have stabilized, with prices high enough to encourage sellers to offer material out. Refiners in China appear to have ample stocks of feed to continue to supply contract volumes. This month, we expect to see a reduction in import volumes of cobalt hydroxide into China. This is expected to tighten refinery feed out to August, should the export ban end towards the later stages of June, as initially planned.

Rob Searle, Fastmarkets

Key points

1. Tariffs spark volatility, nickel prices dip to $13,815
   The US’s tariff communication sent nickel on a roller-coaster ride in April. Although the end-April price of $15,375 per tonne was only 2.2% lower than the end-March price of $15,715 per tonne, the uncertainty caused by the flurry of executive orders on US tariffs sent the LME nickel price to a low of $13,815 per tonne in early April.
   

2. Nickel prices recover but stay below $16,000
   The drop caused by the US tariff announcements, and the fears of tit-for-tat reprisals, was relatively brief. Despite the subsequent recovery, the LME nickel cash price remained below $16,000 per tonne throughout April, underlining the metal’s weak fundamentals.
   

3. Nickel payables rise amid supply strains and plant closure
   Although the LME nickel price has remained under pressure, payables for mixed hydroxide precipitate have jumped because of the limited spot availability of material. Moreover, the closure of BHP’s IRA-compliant Nickel West plant towards the end of last year has limited the availability of IRA-compliant briquettes for the nickel sulfate industry, sending premiums higher.
   

What do our analysts say?

Data from the International Nickel Study Group points to the nickel market remaining heavily oversubscribed in early 2025, and Fastmarkets forecasts a third consecutive annual market surplus above 100,000 tonnes in 2025. With such fundamentals, it is difficult to envision any sustained recovery in the nickel price.

Olivier Masson, Fastmarkets

Key points

1. Manganese sulfate prices fall on weak demand
   Weak spot demand for manganese sulfate in China caused prices to trend lower throughout May. Alongside sluggish buying in the market, high-grade manganese ore prices in China also declined as sentiment weakened, putting further pressure on manganese sulfate prices.
   

2. China’s NCM market slows amid US-China tensions
   Demand from China’s NCM pCAM market has been relatively slow. These challenges are likely to be further exacerbated by ongoing geopolitical tensions and tariffs between the US and China.
   

3. Rising cobalt prices, DRC ban squeeze manganese sulfate demand
   The impact of other precursor material prices appears to be affecting demand for manganese sulfate. Higher cobalt sulfate prices, driven by the ongoing export ban in the DRC, have led to increased cell costs for mid-nickel NCM chemistries.
   

What do our analysts say?

Manganese sulfate prices in China are not expected to see a significant uptick in the coming months as we move into the summer period. The challenges within the NCM cell market continue to pressure production and demand. For now, manganese sulfate prices are expected to track bearish manganese ore prices through late August.

Rob Searle, Fastmarkets

Key points

1. Graphite prices plunge to record lows amid market uncertainty
   Chinese natural graphite flake prices for the battery sector are now at the lowest level since Fastmarkets began price reporting on this product in 2018, at just $400-430 per tonne FOB China. We do not anticipate any near-term recovery in prices given ample supply, declining demand, and the tremendous uncertainty affecting global markets.
   

2. Graphite anode tariffs drive up US battery costs
   Graphite anodes are caught in the crosshairs of the US-China tariff battle. US imports of both synthetic and natural graphite anodes from China are now subject to a combined 170% in tariffs. In 2024, trade data shows that 100% of US graphite anode imports for the EV battery sector originated in China. US automakers and battery cell manufacturers are set to face a significant increase in battery costs. Although our analysis of anode import supply chain data indicates Chinese anode producers have absorbed much of the 25% Section 301 tariff imposed in June 2024, they are not expected to absorb as much of the additional 145% tariffs imposed in the past three months.
   

3. China’s tariffs hike costs for graphite anodes
   With China subjecting its imports from the US to an 84% import tariff, Chinese synthetic graphite anode producers will also see their production costs affected. While China has been reducing its import dependence on US needle coke and green petroleum coke (GPC) in recent years, it still sources about 30% of its GPC from the US. For needle coke, China continues to source over 30% of its imports from Phillips 66 but has been shifting its sourcing to the UK. Assuming there are no exemptions for GPC or needle coke in the Chinese import tariff announcement, these raw materials are poised for a significant cost increase, with additional cost implications for global EV battery anode consumers.
   

What do our analysts say?

US electric vehicle and battery producers have battled in recent years to keep US imports of graphite anodes from China tariff-free, but their efforts have proved futile over the past nine months and the trade status of graphite anodes has shifted dramatically. The Section 301 exclusion granted to graphite anodes was eliminated last May, putting the US import tariff on Chinese anodes at 25%. In the first three months of 2025, we have seen tariffs rise an additional 20% to a total of 45%. 

Amy Bennett, Fastmarkets

Key points

1. Recyclers face challenges with low-value graphite disposal
   The question of what to do with graphite is becoming an increasing problem for recyclers. Despite graphite making up approximately 40% of the black mass, it contributes very little to the overall black mass value. Recyclers are currently producing large volumes of contaminated graphite, which they are struggling to find an offtake for. Furthermore, the low value of electrochemical-grade graphite makes any business case for purifying graphite for further reuse uneconomical. If a use case cannot be found, some recyclers may find themselves disposing of this highly specialized, critical mineral in landfill – at a cost.
   

2. Cobalt export ban tightens market, reshapes black mass payables
   Since the DRC’s cobalt export ban on February 24th, upward pressure in the range of 5-10% has been observed on both NCM and LCO payables as demand from companies looking to stockpile cobalt-rich black mass increased. Since the initial uplift, the cobalt market has begun to readjust, leading Fastmarkets to expect the upward pressure on black mass payables to subside over the coming month. However, as the last of the deliveries that left the DRC before the cobalt export ban reach China, Fastmarkets anticipates a tighter market by mid-summer, which will likely reassert pressure on black mass payables.
   

3. Li-Cycle struggles mirror western recycling challenges
   More bad news in the western recycling sector, as America’s recycling poster child faces the same fate as Europe’s poster child, Northvolt. Li-Cycle announced on May 5th that it is looking for buyers for all or part of its business, marking the end of what was once America’s most hyped battery recycler. The challenges ahead, both in terms of battery industrialization and recycling, are becoming clearer for western players. With the initial bubble of optimism bursting, western recyclers have been downplaying future expansion plans, instead focusing on generating revenue from their existing recycling businesses.
   

What do our analysts say?

With the difficulties of battery recycling becoming clear, the western recycling market has been going through a maturing process. Many recycling companies have begun downplaying expectations and avoiding big press announcements, instead focusing on their core business models. Over the month of May, we should see reduced pressure on payables, primarily driven by a cooling of the cobalt market. Unfortunately, this may only be short-term, as stocks will likely begin depleting over the summer, causing tightened supply in the spot market.

Luke Sweeney, Fastmarkets

While tariff fears remain the dominant theme amidst the general uncertainty created by the administration’s frequent policy changes, EV demand remains strong globally, and US sales have continued to grow through pre-tariff inventory.

Key points

1. CATL innovations boost EV affordability and market growth
   CATL’s announcement of new battery technologies addressing key consumer concerns will further enable the Chinese market to grow its electric vehicle sales base. While its new sodium product has been getting most of the attention, its dual-power system batteries are arguably a more significant development in allowing for affordable EVs to be sold in regions with more demanding temperature conditions.
   

2. Tesla sales drop across Europe, with few exceptions
   The UK has now joined the rest of Europe in seeing Tesla sales fall in its growing EV market, with April sales dropping 62% year-over-year. Only Italy and Norway saw year-over-year increases in Tesla sales for April, while all major European markets have now seen year-to-date reductions, despite the majority of markets other than France posting significant gains.
   

3. Ford, GM tacke tariff losses with partial offsets
   Ford has joined several companies in announcing that it will be suspending its 2025 financial guidance estimates due to a $1.5 billion tariff-related hit, as revealed in its Q1 earnings call. Ford claims it will be able to offset $1 billion, or 40% of expected losses, through remediation actions. This figure is consistent across the US auto industry, as GM aims to offset around 30% of its own even greater tariff-related losses.
   

What do our analysts say?

Pre-tariff vehicle inventory in the US continues to wane, and companies have already begun increasing prices in anticipation of higher-cost products arriving at US ports. Despite some relaxations in duties from the administration, the consensus remains that the worst is still yet to be felt by the American consumer.

Connor Watts, Fastmarkets

Key points

1. LFP 314Ah cell drives cost savings in energy storage systems
   In the first quarter of 2025, the LFP 314Ah cell gradually replaced the 280Ah model as the mainstream choice in the Chinese market. Cell prices continued to decline steadily, with the average price approaching or even falling below USD 40/kWh, further enhancing the economic viability of energy storage systems.
   

2. High-capacity cells and materials transform energy storage tech
   The technological development of energy storage cells is becoming increasingly diversified. From the perspective of battery capacity, cell manufacturers are continuously developing higher-capacity cells to reduce costs. For example, REPT, Hithium, and CATL have each introduced 587Ah high-capacity energy storage cells, which are expected to reduce costs by 5–8% once mass production begins. At the same time, in terms of battery materials, LMFP, sodium-ion, and solid-state technologies remain key areas of R&D focus across the industry.
   

3. South Korea firms boost US EV battery edge
   South Korean battery giants LG Chem and Samsung SDI are ramping up investments in the U.S. to strengthen their position against Chinese competitors, supported by favorable policies like the Inflation Reduction Act. LG Chem is investing over $3 billion in a cathode plant in Tennessee and expanding LFP battery production in Michigan, while Samsung SDI is partnering with Stellantis to build a battery plant in Indiana, set to begin operations in 2025. These moves reflect escalating competition and geopolitical tension in the U.S. energy storage and EV battery market.
   

What do our analysts say?

The recent large-scale power outages in Spain and Portugal have further highlighted the critical role of energy storage systems in supporting renewable energy. In response, manufacturers are actively seeking more economical and optimized solutions to accelerate the global adoption of energy storage. Leading cell manufacturers are increasingly pursuing vertical integration to strengthen their competitiveness.

Walter Zhang, Fastmarkets

Key points

1. Low demand for lithium causes downward price trend
   The market outlook remains bearish, with weak downstream buying activity and little improvement in lithium demand expected in April. Even energy storage battery producers are slashing lithium orders. Despite a promising rebound in EV sales in Europe during the first three months of the year, lithium demand in the region is particularly weak. Most buyers are adequately stocked, and given the length of the supply chain, it could take several months for any positive demand registered in the first quarter to translate into improved upstream lithium demand.
   

2. Spodumene under pressure with decline in lithium demand
   Spodumene prices are on a downward trend due to ongoing weakness in lithium prices in China. While Australian miners have lowered their offer levels, buyers have also reduced their bid levels, creating a significant gap between miners’ and converters’ price expectations. Faced with firm offer prices from Australian producers, Chinese lithium converters are increasingly turning to cheaper feedstocks, including African spodumene, to cut costs and protect margins.
   

3. Elevated production costs bolsters lithium oxide prices
   Despite ongoing weak demand for lithium hydroxide, prices in the seaborne market have been on an upward trend in March. This is due to sellers maintaining firm offers driven by elevated production costs. Notably, in late March, the CIF CJK lithium hydroxide midpoint price regained a premium over carbonate. While short-lived, we anticipate that, in the longer term, lithium hydroxide and carbonate prices will converge, with hydroxide potentially moving to a premium.
   

What do our analysts say?

Recent tariffs announced by the Trump Administration have sent shockwaves through global markets, igniting fears of a global economic slowdown and potential recession. Any hopes for battery demand recovery this year could be easily derailed by higher vehicle prices, inflationary pressures, and disrupted supply chains. This spells ongoing challenges for lithium producers who have been struggling with steeply declining prices throughout most of 2024 and cutting costs and production in the hope of a meaningful and sustained supply-side response.

Paul Lusty, Fastmarkets

Key points

1. Bullish price movements follow DRC export ban
   The first full month of pricing in the cobalt market since the DRC announced the export ban has shown the full extent of the most bullish price movements we have seen in the market since 2022.
   

2. Cobalt prices surge while sulfate soars
   Standard-grade cobalt metal prices (low-end) skyrocketed to a peak of $15.75 per lb in mid-March. Monthly prices averaged at $13.90 per lb, up 45% month on month. The rise in cobalt sulfate prices has been even more severe, with prices rising 74% month on month.
   

3. Prices stabilize mid-month amid renewed Chinese optimism
   Prices did stabilize around the middle of the month with some of the gains lost. However, sentiment in China rose once again with gains in the Wuxi futures contract on the ongoing uncertainty about what the DRC government has in store next.
   

What do our analysts say?

If the DRC government wanted to flex its muscles and show miners and refiners who really controlled global cobalt reserves, it would appear they’ve succeeded for now. Standard grade cobalt metal prices soared to highs not seen since November 2023 in the space of 2 weeks. The market is now awaiting what’s next and what, if any, controls will be placed on the export of cobalt intermediates.

Rob Searle, Fastmarkets

Key points

1. Nickel prices stall in April
   A modest rally in the LME nickel cash price above the $16,000 per tonne level fizzled out, leaving the price up by only 1.6% for the month.
   

2. Indonesian royalty hike drives prices up
   Reports that the Indonesian government was seeking to raise royalties across the mining industry also helped push prices higher.
   

3. Oversupply concerns trigger market sell-off
   The fundamentals reasserted themselves, however, with indications that the market remains heavily oversupplied in early 2025. As a result, the market sold the rally.
   

What do our analysts say?

Indications from Indonesia point to a desire to increase royalties, which would raise costs for nickel producers and increase cost-support price levels. This, coupled with recent news from the Philippines, which is seeking to implement an ore export ban in five years, and production disruptions at PT Gunbuster in Indonesia, should all be supportive of prices.

Olivier Masson, Fastmarkets

Key points

1. Muted manganese sulphate market as NCM demand lags in China
   The manganese sulfate market was quiet in March with limited spot deals and buying. China’s NCM pCAM market has yet to show a significant pickup in demand as we move into Q2.
   

2. Chinese HPMSM operating rates drop amid slow NCM demand
   Operating rates at Chinese HPMSM processors fell to 26% in February. This is not overly surprising given the closure of much of China’s manufacturing during the Lunar New Year holidays. However, the low rates highlight the slow demand from the NCM pCAM market, with utilization rates not having hit above 40% in China since October 2023.
   

3. Manganese prices rise in China on stronger ore costs
   Prices in China averaged 6,050 yuan per tonne across March, up 5.7% month-on-month. The majority of this gain was due to firming port-side high-grade manganese ore prices in China.
   

What do our analysts say?

The NCM pCAM market continues to move along slowly with a limited uptick in production following the holidays in February. The NCM market is also having to contend with the recent spike in cobalt prices, which is likely to limit production of mid-nickel CAM given the spike in costs. Alongside the higher cost of production, the imposition of tariffs on auto imports in the US is causing havoc for many Western OEMs’ EV plans.

Rob Searle, Fastmarkets

Key points

1. Excess supply sees graphite prices plummet to near bottom limit
   Fastmarkets maintains the view that Chinese graphite prices are near a floor. Prices dipped on the low end of the trading range in recent weeks, indicating that supply remains excessive and competition for business remains intense. Prices are now on par with the lowest levels Fastmarkets has noted since price reporting began on this product in 2018. Prices were last at this level in Q3 2020.
   

2. Chinese spherical graphite exports surge due to Indonesian demand
   Chinese spherical graphite (uSPG) exports are posting notable gains in early 2025 following the start of a rising trend in late 2024. The Chinese spherical graphite market has struggled over the past year amid intense competition from synthetic graphite and subsequent reductions in uSPG prices, output, and exports. Exports are recovering, despite continued sluggishness in prices, primarily reflecting the emergence of Indonesia as a consumer of Chinese uSPG. Chinese shipments of uSPG to Indonesia started last July but picked up in earnest in December. The shipments to Indonesia coincide with the start of BTR’s Indonesian anode production plant last August. Indonesia has now emerged as the largest export destination for Chinese uSPG in the first two months of 2025, with 42% of China’s uSPG exports in January-February 2025 destined for Indonesia.
   

3. US tariffs challenge China’s supremacy in the graphite anode industry
   China’s domination of the graphite anode industry, with 99% of global anode output, remains a significant hindrance to efforts by the US and Europe to develop localized and diversified supply chains. The new US presidential administration is addressing this conflict through tariffs and executive orders to promote domestic mining and processing of critical minerals, including graphite. In the past nine months, we have seen US tariffs on imports of Chinese synthetic graphite anodes rise from 0% in June 2024 to 45% in March 2025, with the potential for an additional 25-45% in tariffs expected this month.
   

What do our analysts say?

US electric vehicle and battery producers have battled in recent years to keep US imports of graphite anodes from China tariff-free, but their efforts have proved futile over the past nine months and the trade status of graphite anodes has shifted dramatically. The Section 301 exclusion granted to graphite anodes was eliminated last May, putting the US import tariff on Chinese anodes at 25%. In the first three months of 2025, we have seen tariffs rise an additional 20% to a total of 45%.

Amy Bennett, Fastmarkets

Key points

1. Production scrap dominates battery recycling amid delayed end-of-life volumes
   Fastmarkets predicts that the majority of scrap batteries will continue to come from Chinese gigafactory production waste. In 2025, Fastmarkets projects that 30% of total battery scrap will originate from end-of-life batteries, while 70% will come from production scrap. There are significant concerns regarding current assumptions predicting when the volume of end-of-life scrap will increase. A combination of new battery technologies and changing consumer behavior indicates that EVs are not reaching end-of-life as quickly as previously estimated. This has led to a competitive black mass market, which has particularly impacted smaller Western recyclers.
   

2. DRC cobalt export ban fuels global black mass payable surge
   The DRC’s ban on the export of cobalt ore has caused a global surge in black mass payables. Most notably, since the ban, Europe’s payables for black mass have gone from 65% to a record-setting 71%. In the East, the ban on cobalt ore export has catalyzed fierce competition between S. Korean refiners and their Southeast Asian equivalents.  Southeast Asian refiners are now offering 78.5% payables for NCM/NCA black mass, 3.5% higher than refiners in S. Korea.
   

3. Northvolt bankruptcy highlights Europe’s struggles in battery recycling
   The final nail in the coffin for Europe’s battery poster child, Northvolt, was hammered with its formal declaration of bankruptcy in Sweden. Concerns are growing over whether Europe will be able to develop domestic recycling capacity without foreign help. Despite foreign investment, the cancellation of SungEel HighTech’s planned recycling plant in Gera, Germany, underscores the challenges of doing business in Europe. The project was derailed by slow planning approvals, strong local opposition, and a tough market environment, highlighting the obstacles faced even when there is clear commercial and political support.
   

What do our analysts say?

Turbulence in the cobalt market has driven significant increases in black mass prices, as refiners strive to address an acute shortage of cobalt feedstock. Historically, South Korea offered the highest payables, but its position has now been overtaken by its more integrated Southeast Asian competitors. In Europe, confidence remains low, with the recycling sector weakened by the fallout from Northvolt’s bankruptcy; the delay in end-of-life batteries entering the scrap market has intensified competition for scrap.

Luke Sweeney, Fastmarkets

25% US auto import tariffs take place from April, likely significantly hurting domestic vehicle sales in the months following. European and Chinese EV demand continues solid growth and could see renewed focus as the US weakens OEM profit margins.

Key points

1. US tariffs on vehicles trigger pre-buying surge and sales slump
   US tariff policy continues to change rapidly, with 25% import tariffs on virtually all imported vehicles and vehicle components taking effect April 2nd. This has created a rush for consumers to buy ahead of time, followed by a sharp fall in sales from April until tariffs are relaxed after significant domestic price increases.
   

2. Chinese EV demand grows 16% in Q1, driven by PHEVs
   Chinese EV demand growth looks to be a strong 16% throughout Q1 of this year. This is based on preliminary March numbers, growing month-on-month consistently throughout the quarter. This growth remains focused on PHEV sales at around 40% of EV sales. However, continued increases in battery pack size are making the difference less important when looking at battery demand.
   

3. Xiaomi faces scrutiny after fatal crash in Anhui province
   Xiaomi’s meteoric rise in the Chinese EV market may take a hit following a fatal crash that killed three in Anhui province. The tragic accident involved a standard-issue Xiaomi SU7, which has lower-capability self-driving features than higher-cost versions. This raises questions about limiting safety-impacting software to higher-specification models.
   

What do our analysts say?

Further tariff-driven inflation in the US will have a significant negative impact on automotive purchases and the EV industry if maintained, as the Detroit 3, in particular, are set to suffer due to the need to raise prices within the US to maintain profit margins and their heavily Mexico- and Canada-oriented supply chains. Of major US participants, Tesla comes out ahead under the current tariff environment.

Connor Watts, Fastmarkets

Key points

1. Chinese lithium market struggles with post-holiday restocking
   Post-Chinese Lunar New Year holiday restocking has failed to meet expectations, owing to slow downstream buying activity, which remained largely flat, and high upstream inventory levels – Fastmarkets estimates that Chinese lithium salt inventories stood at 220 kt tonne of LCE or 20% of annual demand at the end of 2024.
   

2. Bright spots for lithium demand in 2025
   Despite the subdued start to the year with little recovery in salts prices and the increasingly complex geopolitical backdrop, we do see bright spots for lithium demand this year, namely: a rebound in the European EV market, albeit this could be tempered by a relaxation of timescales to meet new CO2 emission targets; the rise of plug-in hybrid vehicles with larger battery packs, widening the addressable geographic market for electric vehicles; and the continued strength of the ESS market, where we are expecting almost 50% year-on-year lithium demand growth.
   

3. Spodumene price standoff pressures lithium supply chain
   The wrangling between spodumene miners and converters continues, with major miners remaining firm on price due to high costs, but converters unwilling to entertain prices above $850 per tonne as their margins become increasingly negative with salt prices drifting lower. If bidding levels drop sufficiently, then miners will have to moderate their price expectations. Longer-term, a persistent disconnect between spodumene and salts prices could prompt changes to contract pricing and influence where strategic investments in the supply chain are made to realize the strongest margins.
   

What do our analysts say?

We are entering a highly uncertain but potentially transformative year for the lithium market – we think prices have broadly bottomed out, the market is rebalancing, and the demand picture appears brighter. But many derailers and tensions exist – EV demand recovery in key markets is far from certain, particularly with the watering down of targets. Rapid restarts of idle capacity could quickly return the market to a larger surplus, negatively impacting sentiment and capping prices. Geopolitical and trade tensions, now extending to lithium-related technologies, are adding further complexity to the outlook.

Paul Lusty, Fastmarkets

Key points

1. DRC imposes four-month cobalt export ban
   The cobalt market has been rocked by the shock announcement of an export ban implemented by the DRC government on February 21. Exports of cobalt hydroxide are to be blocked for 4 months as the government attempts to support prices.
   

2. Cobalt prices surge following DRC export ban
   Prices have reacted in China and the seaborne market – since February 24, when the ban became public knowledge, China metal prices have already risen 27% – while the standard grade cobalt metal has risen 12%.

3. Cobalt supply shortages loom amid export ban
   While there are stocks of cobalt hydroxide and MHP to feed China’s refiners in the short term, the feeling in the market is that these will not be sufficient to cover production through mid-summer.
   

What do our analysts say?

The cobalt market has been quiet and stagnant for some time as production has far outstripped demand in the last 18 months. This was the first sign of life and took nearly all parties by surprise. In the last four months of 2024, the DRC exported 68kt of cobalt as hydroxide to China for refining – a cut of supply this large will likely lead to a significant price correction in the coming months.

Rob Searle, Fastmarkets

Key points

1. Nickel prices hit near-term lows in February
   The LME nickel cash price traded at near-term lows in February, testing the 15,000 per tonne level and closing below this level on two occasions.

2. Nickel prices end higher despite lower monthly average
   Although the LME nickel cash price at the end of February stood 2.8% higher than at the end of January, the monthly average price was 0.7% lower than in January.
   

3. Nickel market balances supply concerns and global developments
   Weighing on the price were reports that Indonesia’s ore quotas might be less restrictive than originally thought, but the price also received some support from a return of risk appetite across markets as the immediate threat of US trade tariffs subsided. Moreover, the Philippines’ senate passed a bill banning nickel ore exports, although this will only be enacted five years hence, giving plenty of time for the market to adjust and capacity to be added in the Philippines. Finally, reports out of Indonesia indicated that PT Gunbuster, one of the country’s larger NPI smelters, was running at reduced capacity because of part-owner Jiangsu Delong’s financial difficulties.
   

What do our analysts say?

The nickel price remains under pressure in early 2025, with the market significantly oversupplied in the past two years. Although reports of an Indonesian NPI smelter operating at reduced capacity might indicate a tightening of supply, our disruption allowance for 2025 more than covers this. Moreover, it is likely that the ore not processed at the Gunbuster smelter will be sold or redirected to other smelters, resulting in little loss of output at the country level. For the nickel price to stage any meaningful recovery will take a lasting change to the market’s fundamentals. That will require either additional supply-side restraint or a stronger-than-expected rise in demand.

Olivier Masson, Fastmarkets

Key points

1. Subdued manganese sulfate prices amid limited buying 
   Manganese sulfate prices have remained subdued in early 2025 with limited spot buying from NCM pCAM producers in China. Small levels of restocking took place in early January, with the market noting limited liquidity pre-holidays.
   

2. Upstream sentiment drives minor gains in manganese prices 
   As the market reopened, there has yet to be a significant improvement in buying from the midstream. Minor gains in manganese sulfate prices have largely been driven by more bullish sentiment upstream in manganese ore markets. Buyers have noted a tightening of availability and lowering stock levels.
   

3. Chinese manganese sulfate utilization drops to 27%
   As expected, manganese sulfate utilisation rates at Chinese processing sites dipped in January, falling to 27%.
   

What do our analysts say?

The quiet manganese sulfate market in early March appears fairly symptomatic of the wider headwinds for NCM demand in 2025. Slower uptake of EVs in the US under the new administration and continuing pain points on EV prices in Europe continue to feed back to slow spot buying for manganese sulfate. Barring any major upstream supply shock like we saw in 2024 in Western Australia, Chinese processors look well set to cover demand in the short to midterm.

Rob Searle, Fastmarkets

Key points

1. Green petroleum coke prices skyrocket by 68%
   In mid-February, green petroleum coke prices skyrocketed by 68%, from $457 (3330 yuan) to $768 (5600 yuan) per tonne. The spread between low sulphur green petroleum coke and green petroleum needle coke narrowed to merely $20 from the traditional $300-$400. Green petroleum coke is a major feedstock in the production of battery anode material and prebaked anodes for aluminium production.
   

2. Supply shortages and policy shifts drive petroleum coke surges 
   The unexpected surge in green petroleum coke prices was driven by concerns of supply shortages due to a significant drop in imported volumes to China from the US in the second half of 2024. Additionally, following changes in policy for the deduction of consumption tax on fuel oil in China, many small and medium-sized refineries went into shutdown and maintenance, with the operating level of refineries in the Shandong province falling below 50%—the lowest in the past 3 years, thus lowering petroleum coke production.
   

3. Spherical graphite prices rise amid petroleum coke surge
   Spherical graphite, made from natural graphite, increased for the first time since March 2022 in reaction from suppliers to the rising prices of green petroleum coke, the main feedstock for synthetic graphite.
   

What do our analysts say?

Increasing petroleum coke prices would add more pressure to Chinese anode makers, who have seen their profit margins eroded over the last year amid overcapacity and severe competition. Depressed anode prices are beginning to take their toll in China, with a court ruling Shanshan, the largest synthetic anode producer, to enter bankruptcy reorganization due to inability to serve its debts to Chinese banks, while several other anode producers slowed down their expansion plans. The anode industry might be heading into a period of consolidation, with a handful of players being able to survive under a low-margin environment and constant technological innovation.

Georgi Georgiev, Fastmarkets

Key points

1. EU’s €100 billion clean industrial deal boosts green manufacturing
   The EU’s €100 billion investment under the Clean Industrial Deal (CID) aims to cut energy costs and accelerate green manufacturing, including battery recycling. This initiative paves the way for Europe to lead the circular economy by 2030.
   

2. Black mass payables rise amid tight supply and completion
   Black mass payables have risen in the last quarter, despite a decline in underlying metal prices, with tight black mass supply and fierce competition in Asian markets driving prices higher. Nickel, cobalt and lithium prices fell by 2.0%, 5.9%, and 8.5%, respectively. Meanwhile, NCM black mass payables increased by 6.6% in Europe, 5.6% in Southeast Asia, and 3.5% in South Korea. In contrast, U.S. NCM payables remained relatively stable, rising by just 0.7%. 

3. Europe’s black mass refining lags far behind China
   By 2025, Europe’s black mass refining capacity will be just 20,000 tonnes—32 times smaller than China’s staggering 650,000 tonnes. This supply chain weakness risks making Europe dependent on foreign processors for critical battery materials.
   

What do our analysts say?

Despite ambitious recycling targets and recent green investment plans, Europe lacks the refining muscle to process its own black mass. Until domestic facilities are built, valuable lithium, nickel, and cobalt materials will continue flowing to South Korea, Southeast Asia, and the US for processing.

Andre Cortesao, Fastmarkets

Key points

1. Strong EV demand in China for 2025
   Consumer sentiment towards EV demand within China remains strong looking at the rest of 2025, following discussions with OEMs at Fastmarkets Battery Raw Materials Shanghai conference. Consensus from participants puts domestic sales growth expectations between 15% and 20% relative to 2024, though exports from the country are expected to stagnate in their % demand growth. 

2. Tariffs on China and Mexico to impact US auto market
   President Trump’s planned tariffs on China and Mexico come into force in early March, and due to the locations of many suppliers within the automotive supply chain, will be swiftly followed by price rises to most automotive products within the U.S. This will understandably affect BEV sales, but it will also affect internal combustion engine vehicles and the wider U.S. economy. How long this will last is questionable, as the economic pain suffered by both parties through imposing tariffs will likely be quite severe, so it will either be continually postponed or retaliatory tariffs will force compromise.
   

3. Norway maintains over 95% EV market penetration
   Norway has reached 94.7% EV sales within its new passenger vehicle industry, slightly below January’s 95.8%, but the trend of a 95%+ EV penetration rate for the year is here to stay within the country.

What do our analysts say?

A strong start to the year for China and Europe is likely to be overshadowed by forecast uncertainty in the U.S., particularly as the effects of tariffs and the extent to which federal subsidies are to be reduced by the new administration shows itself in sales figures.

Connor Watts, Fastmarkets

Key points

1. Will restocking emerge?
   Market waiting to see whether restocking emerges after the Chinese Lunar New Year holiday, given rebound in European EVs and ongoing strong energy storage systems (ESS) market, this may well happen.

2. Higher prices trending in spodumene market
   Spodumene prices have trended higher to the extent they are now squeezing Chinese convertors’ margins. Will this halt spodumene price rises, or lift lithium salt prices?  

3. Strong EV sales data in Europe with rebound expected
   EVs sales in Europe are expected to rebound in 2025, with some very strong EV sales data for January emerging, like BEV sales in Germany up 53.5% and up 41.6% in the UK. This will be a relief to the lithium industry, as Europe was one of the weak spots last year. This should also be good for lithium hydroxide demand, as European EVs tend to favour NCM lithium-ion batteries. But the question is, will this be countered by less appetite for EVs in the US? 

What do our analysts say?

The lithium market suffered from oversupply in 2024, as well as weaker than expected demand, so the market has been waiting for demand to catch-up. Demand from ESS grew strongly last year and that is expected to continue this year. Early signs, plus our expectations, are for a stronger EV market in Europe this year, with continued strength seen in China. The return to strength in Europe may be enough to swing the tide in the lithium market and price.

Will Adams, Fastmarkets

Key points

1. Will cobalt demand pickup after the Lunar New Year?
   The cobalt market is eagerly awaiting the reopening of the Chinese market post-Lunar New Year holidays to see what level of demand pickup there is heading into the Spring.
   

2. Oversupply in cobalt intermediates market continues
   A significant improvement in metal and cobalt salt demand is expected to be required in the coming months given the continued oversupply of cobalt intermediates in the market from the DRC and Indonesia.

What do our analysts say?

The return of China’s manufacturing and pCAM industries this week will be keenly watched by stakeholders in the cobalt value chain. At this stage we are not expecting a significant price correction given the oversupplied nature of the market from intermediates to cobalt metal. CMOC’s guidance for 2025 set at 100-120kt of cobalt suggests we’re in for another bearish year for the market. In the US, the potential tariffs on Canadian cobalt metal could see short-term tightening on certain Western brands, however, we’re not holding out for a strong recovery in standard-grade cobalt metal pricing for the rest of the year.

Rob Searle, Fastmarkets

Key points

1. LME nickel cash prices remains largely unchanged
   The LME nickel cash price was little changed in January, trading in a US$15,000-16,000/tonne range. By the end of the month, the nickel price was down by 0.4% at $15,040/tonne.

2. Why did the LME nickel price remain low?
   With the market oversupplied there was little impetus to push the price higher and so the LME nickel price remained below $16,000 per tonne, which had been a strong support level for most of 2024.

3. Supply response from Indonesia unlikely
   Reports that Indonesia would lower its ore mining quota for 2025 were not taken seriously by the market, with neither the nickel price nor ore prices picking up. The latest reports indicate that the ore mining quota for 2025 will be higher than in 2024, suggesting that despite the market’s oversupplied fundamentals, a supply response from Indonesia is unlikely.
   

What do our analysts say?

The nickel price remains under pressure, continuing the trend seen throughout 2024, which followed a sharp fall in 2023. With little prospect of the market rebalancing soon, any prospects of a sustained upside to the price, will require additional production cuts, or stronger-then-expected consumption growth.

Olivier Masson, Fastmarkets

Key points

1. Bearish prices in battery-grade manganese sulfate market 
   The Chinese battery-grade manganese sulfate market saw bearish prices once again in January with limited restocking and a slowdown in business activity leading up to the Lunar New Year holidays in the region.
   

2. General trend of declining demand and prices 
   Prices averaged 5,700 yuan per tonne, down 10% year on year. Despite some bullish price movement in the middle of 2024 on tighter ore availability in China, the general trend for the manganese sulfate market has been that of declining demand and prices over the last 12 months.
   

3. Chinese operating rates remain low
   Operating rates remain low in China around 30-40% with this price level for manganese sulfate still uneconomical for several non-integrated and higher-cost producers.
   

What do our analysts say?

We await to see what kind of recovery and restart there is in the NCM pCAM and CAM sectors in China post-holiday. Fastmarkets’ view is for a recovery in buying from the midstream to support pricing. Combine this with the need to restock material given the destocking we’ve seen over the last 12 months and we’re hopeful for supported prices this year. But as price rises, previously closed processors in China will be incentivised to re-enter the market, capping any potential bull run.

Rob Searle, Fastmarkets

Key points

1. Fine flake graphite prices reach new low
   In January, fine flake graphite prices in China reached their lowest level since 2020, falling to an average of $435 per tonne, which is 47% lower than their peak values in 2022. Synthetic graphite took significant market share in the battery space and sufficient supply of fine flakes in China has kept prices under pressure.
   

2. Are synthetic anode prices set to improve? 
   Green petroleum coke prices continued to climb and were 30% higher year-on-year in January, which could be the initial signal for long awaited improvement of synthetic anode prices, following a year of severe price competition between Chinese anode producers.
   

3. US graphite producers seeking tariffs on Chinese anode imports
   The US International Trade Commission gave a greenlight for the antidumping and countervailing investigation on imports of active anode material from China to the US. North American graphite producers are seeking tariffs as high as 920% on Chinese anode imports. There is already 25% tariff in place on active anode material from China under the Section 301.

What do our analysts say?

The new antidumping and countervailing duty investigation on active anode imports from China demonstrates that the anode production is the most challenging part of the battery supply chain for the US to compete with China. The existing 25% tariff have had limited impact on anode imports from China, demonstrating that currently Chinese anode makers remain the cornerstone of global anode supply chains.

Georgi Georgiev, Fastmarkets

Key points

1. India supercharges battery recycling with duty-free imports of scrap and black mass
   In the short term, this move will lower cost barriers for domestic recyclers, boosting imports of both black mass and scrap batteries. Fastmarkets expects 50,000 tonnes of black mass refining capacity in India in 2025 increasing to 200,000 tonnes by 2035 and with this move we expect a positive impact on these numbers. 

2. Production scrap still the main feedstock for the next five years
   With demand growth for EVs slowing down and battery lifetimes longer than expected, production scrap will continue to be the primary feedstock for battery recyclers. Fastmarkets expects production scrap to be the primary source of these critical battery materials until 2030. With this mindset, Li-Cycle’s OEM Germany deal, and ACE Green’s Africa partnership secure vital feedstock for their battery recycling operations. 

What do our analysts say?

India’s move on duty-free imports of scrap and black mass aligns with the progress the country is making toward building a mature battery recycling infrastructure – first by establishing regulations to guide recycling targets since 2022 and now by eliminating import duties on scrap. In the short term, this move will lower cost barriers for domestic recyclers, boosting imports of both black mass and scrap batteries, positioning India as a major global player in battery recycling for the coming years.

Andre Cortesao, Fastmarkets

Key points

1. Pause in tariffs for Mexico and Canada
   Trump’s tariffs on Mexico and Canada have been paused following threats of retaliatory tariffs and discussions with the nation’s leaders. These would have significantly impacted demand for vehicles from companies importing into the US from the two countries, so the rescinding of these tariffs will be welcomed by consumers and OEMs like VW. Tariffs on China remain however, and the announced retaliatory tariffs on more critical minerals do not bode well for the semiconductor industry, which is an increasingly key cost to making electric vehicles. 

2. Ford to build EREVs despite setbacks to US-related EV policies
   Ford’s announcement to build and sell extended ranged EVs (EREV) into the US market should come as little surprise, as despite setbacks to US-related policies, the design of an EREV suits the US market best of all due to its preference for large vehicles and range requirements.
   

3. Why is Tesla’s leadership position in EV sales slipping?
   Preliminary January sales for Tesla indicate that its leadership position within EV sales could be slipping due to a combination of an ageing model lineup and its deteriorating brand image within Europe, as it also loses ground in the Chinese market. Tesla’s EV sales in January fell 63% year-over-year in France, 44% and 38% in Sweden and Norway respectively, totalling just 55% of last year’s deliveries in major European countries. 

What do our analysts say?

Tesla’s continued sales decline would slow the overall EV transition after what were slow years in Europe and the US. While most demand will likely shift towards other companies, offering slight respite for incumbent OEMs, some of this will be lost to hybrids and traditional ICE vehicles.

Connor Watts, Fastmarkets