“We now expect cobalt demand to be even stronger as EV sales continue to accelerate,” Fisher said. That’s why many experts predicted that cobalt demand would continue to enjoy healthy levels for the year. While conditions were seen easing in H2, the impact of the Russia-Ukraine war called that into question.ĮV forecasts at the start of the year indicated that the strong sales trend seen in 2021 would not slow down in 2022. “We expect that market tightness will continue while global supply chains remain constrained and keep intermediate payables high,” Fisher said. By the end of March, European prices were near US$40. Russia is the world’s second largest producer of cobalt, with 2021 output of 7,600 metric tons (MT), as per the US Geological Survey.Īfter averaging US$24 per pound in 2021, European metal prices started the year at around US$32, but rose on the back of constrained conditions and uncertainty around the war in Ukraine. “Russia’s invasion of Ukraine was of course the key shock which has tightened the screws further on the market,” he said. In Q1, cobalt's performance was mostly as expected, with tight conditions persisting and strong demand continuing from the battery market, Harry Fisher, then of CRU Group, told the Investing News Network (INN). Whether new battery technologies will reduce demand, or the increase of electric vehicles and the need for cobalt will rise, will have to be watched for in the coming months to determine the future of this important metal.What happened in the cobalt market in 2022?Ĭobalt market in Q1: Strong demand supports prices While there are several supply changes that will be occurring from 2019 into 2025, demand will play the most deciding factor on the future price fluctuations of cobalt metal. However, this lab work may take years, as electric vehicle manufacturers still expect cobalt supplies to accelerate ten-fold into 2025. These delisting and ban initiatives will follow an assessment period based on the new LME rules by 2022.Īnother factor to watch out for in the coming years that may influence the cobalt market involves vehicle manufacturers looking for battery chemistries that do not use as much cobalt. The LME plans to push out an initiative to delist any cobalt brands that have not been responsibly sourced, according to Investing News Network. In addition, prices are expected to recover due to the LME instituting new bans on illegal mining happening in the Democratic Republic of Congo. Industry experts expect demand to rise again with mines increasing their cobalt output. Artisanal mining took off and experienced exponential growth for several years, then declined due to lower cobalt prices. The Democratic Republic of Congo supplies most of the cobalt to the world. On the other hand, prices are also expected to see a positive increase based on the battery demand in the electric vehicle market.Īnother change which may impact the cobalt market involves mining production occurring in Africa. This may keep prices depressed for a time. Buyers of cobalt, especially those in China, are only expected to purchase cobalt for spot deals. The volatility of prices for cobalt continues due to a range of circumstances happening in several countries. Prices Continue to Fluctuate, But Expected to Recover By March 2019, cobalt prices hovered around US$14/lb and experienced a slight rebound in April at US$18.50/lb. Due to the oversupply of cobalt in warehouses by investors and no long-term projects set up to increase demand for the metal, prices in the United States declined to US$26/lb at the beginning of 2019. At the end of 2018, the price for cobalt on the LME went down to $32,000 a ton. Cobalt prices crashed for a two-year period. However, this upward trend began a downward spiral for the remainder of 2018. In the United States, cobalt metal as a little over US$40/lb. Investors purchased cobalt in large quantities for their warehouse so they could weather through the trade war.Īt the end of 2017, cobalt prices went up to $75,500 a ton on the London Metal Exchange (LME) as it continued to trend high and peak in April of 2018 at about $100,000 a ton. One of the main reasons attributing to this price surge was the fears of the tariffs between the United States and China. Throughout every quarter, cobalt prices rocketed skyward as there was a 129% surge, according to. We are a long way from the high prices back in 2017 for this metal. When looking at the price market, there has been drastic price fluctuations, as companies are wondering if this trend will continue or if rates will soon stabilize. Purchasing this metal at an acceptable price and answering consumer demand can influence a manufacturer’s operations now and in the future. When it comes to tools, superalloys, magnets and batteries, cobalt is a key material used in manufacturing products we need in our daily lives.
0 Comments
Leave a Reply. |
Details
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |