More downside seen for Asian black mass payables amid weak buying

Payables for black mass in key Asian markets showed potential for more downside in the week ended Wednesday January 31, according to market sources

There were transactions for nickel cobalt manganese (NCM) black mass heard concluded at payables around 70% CIF South Korea during the week, for nickel and cobalt, including the value of lithium, according to sources. This was largely stable week on week.

A South Korean trading source said their recent deals were at 70-72% CIF South Korea for nickel and cobalt including the value of lithium. “It seems very stable these days, [but] the overall quality of black mass came up, so people became very specific about the status of packing and payment terms,” the trader said.

A major EU trader source said he can still achieve “just above” 70% CIF Asia for nickel and cobalt including the value of lithium in NCM black mass.

A second European trader source said that South Korean tradable levels were most recently around 65-66% CIF for nickel and cobalt, excluding the value of lithium for EU black mass.

No rush to buy

Lithium prices were weakening, and cobalt prices remained low in the past week. Market sentiment for black mass remained bearish due to slow demand for the material,” a key buying source in South Korea told Fastmarkets.

Recent bids for such material were heard at payables of 60.0-70.5% CIF South Korea for nickel and cobalt including the value of lithium, sources told Fastmarkets.

“There were also Chinese traders buying NCM black mass from the Korean market at just 55-60% for nickel and cobalt, which was way below the current market level, dragging down market mood,” a second South Korean buying source said.

An oversupply of black mass also led to more of a wait-and-see stance in the market, sources told Fastmarkets on Wednesday.

“We’ve been getting offers from Spain, France and the US, which allowed us to choose material with specifications that suit us the best. We are in no rush to buy,” the second South Korean buying source said.

Fastmarkets’ assessments of the black mass, NCM/NCA, payable indicator, nickel, cif South Korea, % payable LME nickel cash official price and of the black mass, NCM/NCA, payable indicator, cobalt, cif South Korea, % payable Fastmarkets’ standard-grade cobalt price (low-end) were both at 65-70% on Wednesday, widening downward by 1 percentage point from 66-70% on January 24.

Fastmarkets’ assessment of the black mass, NCM/NCA, payable indicator, lithium, cif Southeast Asia, % payable Fastmarkets’ lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea was 3-5% on Wednesday, unchanged week on week.

Bids for high-cobalt lithium cobalt oxide (LCO) black mass from South Korea were heard at 63% CIF for cobalt, including the value of lithium.

But LCO black mass suppliers from India were targeting at least 64% CIF South Korea for cobalt, value of lithium included, preventing any deal from being concluded in the past week.

Key market participants believed that South Korean buyers could pay at most 63-68% CIF for cobalt in LCO black mass, including the value of lithium.

Fastmarkets’ assessment of the black mass, LCO, payable indicator, cobalt, cif South Korea, % payable Fastmarkets’ standard-grade cobalt price (low-end) was 61-66% on January 31, unchanged week on week.

And Fastmarkets’ price assessment of the black mass, LCO, payable indicator, lithium, cif South Korea, % payable Fastmarkets’ lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices, cif China, Japan & Korea was 3-5% on Wednesday, unchanged week on week.

Falling payables

A Southeast Asian consumer source said their highest workable price for NCM black mass would be 70-72% CIF for NCM black mass with payables of nickel and cobalt, including the value of lithium, but felt the market would fall soon.

“In the first two weeks of February, we believe prices will fall because of the Chinese New Year holidays period,” the consumer source said on Thursday February 1. NCM black mass was heard sold to Southeast Asia last week at payables of 70% CIF for nickel and cobalt, including the value of lithium, for 100 tonnes from the United States.

A second sale of NCM black mass was heard this week at 65% CIF for nickel and cobalt, including the value of lithium, while lithium cobalt oxide (LCO) material was heard sold at 63% CIF for cobalt, including the value of lithium. But the consumer source said he thought the metal content of this NCM material was below average, causing a lower payable.

In the European market, payables also were largely unchanged. A recent deal for NCM black mass came to light at 53% EXW Europe for payables of nickel and cobalt.

A third European trader source said he would expect bids around 45% EXW Europe for NCM black mass, but no deals were heard as low as this, with the lowest recent sale heard at 47% EXW.

LCO black mass in Northern Europe was heard traded at 54-55% EXW for cobalt, according to a seller source.

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