Lithium Ore:
This week, lithium ore prices showed little change WoW and are expected to follow the downward trend of lithium chemical prices in the short term. Spodumene market prices remained stable. Although overseas mines maintained a sentiment to stand firm on quotes, domestic demand for high-priced spodumene concentrates was cautious due to the decline in lithium carbonate prices. Recently, there have been several transactions at reduced prices, and overseas lithium ore is expected to decline. Regarding lepidolite, under the downward trend of lithium carbonate prices, small and medium-sized traders slightly lowered their quotations. Some downstream lithium chemical plants saw a relief in ore shortages, leading to a reduced willingness to purchase high-priced lepidolite concentrates. In the short term, with the expectation of declining lithium carbonate prices, lithium ore prices are anticipated to pull back to some extent. Overall, supply and demand dynamics are significantly influential. Overseas suppliers maintained a firm stance, but domestic spot transactions and smelter purchase willingness were low, resulting in complex transaction factors.
Lithium Carbonate:
This week, spot lithium carbonate prices continued to decline, with a drop of around 800 yuan/mt. On the supply side, weekly lithium carbonate production continued to increase, though the growth rate gradually slowed, maintaining strong supply momentum. On the demand side, some downstream material plants are expected to see less optimistic production schedule increases in March than previously anticipated, with overall growth relatively limited. Lithium carbonate exhibited a persistent supply surplus. Based on current market transactions, the fundamental oversupply situation remains unchanged, and spot lithium carbonate prices have shown a downward trend. At these relatively low price levels, downstream purchase willingness strengthened, and spot transactions significantly rebounded WoW. Most transactions were between traders and downstream material plants, dragging spot lithium carbonate prices downward. Upstream lithium chemical plants still held a relatively firm sentiment to stand firm on quotes. Considering the clear trend of increased domestic lithium carbonate output and the situation of imported lithium carbonate, domestic lithium carbonate is expected to remain in surplus in March, with a relatively large surplus margin. Spot lithium carbonate prices are more likely to fall than rise.
Lithium Hydroxide:
This week, lithium hydroxide prices continued the downward trend from last week and are expected to decline further in the short term. Some upstream lithium chemical plants maintained low production due to weaker-than-expected demand and losses, with a softened sentiment to stand firm on quotes. Downstream ternary cathode material plants saw limited demand recovery after the holiday, with sufficient inventory suppressing additional demand for lithium hydroxide. Overall market sentiment was relatively pessimistic, and the short-term downward price trend was evident. In the future, with fluctuations in lithium carbonate prices and changes in market demand, lithium hydroxide prices may continue to face downward pressure. However, specific trends will depend on changes in supply and demand.
Refined Cobalt:
This week, refined cobalt prices continued to rise. On the supply side, mainstream refined cobalt smelters maintained stable operating rates, ensuring sufficient market supply. On the demand side, downstream inquiries were active, and restocking willingness increased. From a market perspective, the market was filled with numerous messages this week, fueling strong sentiment for price increases. Some downstream buyers, concerned about excessive price hikes in the future, showed increased purchase willingness. Looking ahead, as the current price increase has been rapid, the market may need some time to digest this round of growth. Therefore, refined cobalt prices are expected to stabilize next week, with the market adopting a wait-and-see approach.
Intermediate Products:
This week, cobalt intermediate product prices rose slightly. On the supply side, customs transportation remained smooth, and port arrivals were unaffected. On the demand side, market concerns about potential price increases led to stronger inquiry willingness. From a market perspective, the week was marked by numerous messages, with mainstream sellers primarily holding back offers. Next week, the overall market situation is expected to remain stable, and spot prices may continue to rise.
Cobalt Salts (Cobalt Sulphate and Cobalt Chloride):
This week, cobalt salt prices increased. On February 22, the DRC announced a four-month suspension of cobalt exports to address market oversupply issues. This news had a strong impact on market sentiment, with upstream smelters generally suspending quotations. Some quotations reflected a sentiment to stand firm on quotes, providing short-term support to the cobalt salt market and driving prices upward. Next week, as market sentiment continues to ferment, the sentiment to stand firm on quotes is expected to persist, and inquiry activities may increase, leading to a slight rise in spot prices. However, given the existing inventory and less-than-ideal actual demand, the momentum for sustained price increases is limited. Additionally, cobalt raw material supply remains relatively sufficient, and the oversupply situation is unlikely to change in the short term, making further sustained price increases less likely and potentially leading to a pullback.
Cobalt Salts (Co3O4):
This week, Co3O4 prices increased, mainly influenced by the DRC's announcement of a cobalt export suspension. Smelters suspended quotations, and market sentiment turned cautious, providing stronger price support. Meanwhile, rising cobalt salt raw material prices further pushed up Co3O4 costs. Although spot prices are expected to continue rising in the short term, the existing inventory held by LCO producers and less-than-ideal market demand may limit sustained price increases. As a result, the market remains in a wait-and-see mode, and future price trends will depend on raw material supply conditions.
Nickel Sulphate:
As of this Thursday, the SMM battery-grade nickel sulphate index price stood at 26,594 yuan/mt, with the quotation range for battery-grade nickel sulphate between 26,410 and 27,070 yuan/mt. The average price increased WoW. On the supply side, at the beginning of the week, LME nickel price declines reduced costs for nickel salt smelters, leading to slight price concessions. However, by the end of the week, with LME nickel prices rebounding and the impact of the DRC policy, the coefficient of cobalt in MHP increased. This put cost pressure on nickel salt smelters, resulting in a strong sentiment to stand firm on quotes and a rebound in smelter quotations. On the demand side, although ternary cathode precursor production schedules for March fell short of expectations, they showed improvement compared to February. This week marked a procurement period for nickel salts, with active market inquiries and transactions. Precursor manufacturers have yet to complete inventory restocking for March, indicating continued external purchase demand. Overall, due to rising costs and the sentiment to stand firm on quotes driven by losses at nickel salt smelters, nickel sulphate prices are expected to rise further next week.
Ternary Cathode Precursors:
This week, prices for 5-series consumer-grade, 6-series consumer-grade, and 8-series power-grade ternary cathode precursors all increased significantly.
In terms of raw material costs, nickel sulphate and manganese sulphate prices rose slightly, while cobalt sulphate prices surged, mainly due to the DRC's cobalt export ban. This change drove varying degrees of price increases across precursor series.
On the demand side, the overall domestic and international precursor markets remained weak, further pressured by the continued competition from the LFP market. March demand fell short of expectations. On the supply side, precursor manufacturers continued price negotiations due to losses, with long-term contract signing conditions less than ideal. Some manufacturers may increase the proportion of spot orders.
The four-month cobalt export ban is expected to continue driving up cobalt raw material prices in the short term. Looking ahead to next week, considering the sentiment to stand firm on quotes among precursor manufacturers facing losses and the anticipated rise in cobalt salt prices, precursor prices are likely to increase further.
Ternary Cathode Materials:
In terms of prices: At the beginning of the week, 5-series and 6-series ternary cathode material prices declined, mainly due to falling lithium carbonate prices. However, with the DRC's four-month cobalt export suspension, cobalt sulphate prices surged significantly later in the week. Despite declines in both lithium carbonate and lithium hydroxide prices, the rise in cobalt sulphate prices drove up prices for 5-series, 6-series, and 8-series ternary cathode materials.
Production and Supply: The recovery of orders for ternary cathode material producers in March varied. Orders for 6-series materials were relatively optimistic, while 5-series and 8-series materials might struggle to return to January levels. Many enterprises remained in a wait-and-see phase, awaiting downstream order trends by the end of February to determine future production plans. Meanwhile, overseas demand for ternary cathode materials showed limited growth compared to pre-holiday levels, maintaining relatively stable demand, which led to weak production schedule growth expectations for some producers mainly supplying overseas markets. Overall, the concentration of orders among top-tier enterprises further increased in March, intensifying market competition and concentrating resources and orders among leading companies.
LFP: Lithium carbonate prices fell by about 800 yuan/mt this week, while LFP processing fees remained stable overall. However, some material producers implemented processing fee increases recently, mainly for mid- to high-compaction products. It is expected that the processing fee component in SMM's LFP price will be adjusted soon. Regarding lithium carbonate discounts, negotiations have not been fully concluded. Downstream battery cell manufacturers still showed sentiment to lower discounts, and some material producers experienced reduced lithium carbonate supply from customers, increasing potential loss risks for material producers. Negotiations are ongoing. On the supply side, LFP material producers maintained relatively stable operating rates this week, though some medium- and small-sized LFP producers reduced or halted production. Leading material producers maintained stable production. On the demand side, some downstream battery cell manufacturers slightly reduced February procurement volumes, causing minor adjustments in the supply chain structure and leading to an overall inventory increase in February.
Iron Phosphate: The iron phosphate market remained relatively stable this week. In February, with a slightly weak supply-demand relationship, prices did not experience significant volatility. Since last week, industrial ammonium prices rose from 5,800 yuan/mt to 6,100 yuan/mt. Phosphate chemical enterprises consciously controlled shipments to push up prices. Currently, iron phosphate producers reported difficulties in procuring industrial ammonium, while ferrous sulphate prices remained stable at high levels. Costs provided some support for prices, preventing significant declines. However, due to weakened downstream demand, there was insufficient room and momentum for further price increases.
LCO: LCO prices rose this week, with the latest prices for 4.2V, 4.4V, and 4.5V LCO at 135,000 yuan/mt, 139,000 yuan/mt, and 150,000 yuan/mt, respectively. On the raw material side, Co3O4 prices surged significantly due to the DRC cobalt export ban, while battery-grade lithium carbonate prices declined, enhancing overall cost support. On the supply side, LCO production in February decreased by 5% MoM, but March production schedules are expected to increase. On the demand side, digital 3C orders remained stable, and the market held a bullish outlook on LCO prices. With further policy support, market demand is expected to continue recovering, and prices may stabilize.
Anode: Anode material prices showed an upward trend this week. On the cost side, due to the previous surge in petroleum coke prices, anode producers reduced procurement volumes, leading to a decline in downstream demand for petroleum coke. Meanwhile, as many refineries remained under maintenance, petroleum coke supply also decreased. Under the dual weak supply-demand scenario, low-sulphur petroleum coke prices remained stable at highs this week. Needle coke prices, which had risen earlier due to multiple factors, stabilized this week due to sluggish demand and sufficient supply. Limited by high electricity costs during the dry season, profits for outsourced graphitisation approached cost levels, creating upward price sentiment. However, the oversupply situation in outsourced graphitisation was difficult to reverse, and prices remained stable with a weak trend this week. On the demand side, the market gradually recovered, and demand rebounded. On the supply side, despite the market recovery and increased demand, the supply volume of anode materials showed no significant improvement due to rapidly rising costs. Looking ahead, under the backdrop of high raw material costs, anode material prices may further increase with market recovery.
Separator: Lithium battery separator prices remained stable this week. Previously, the separator industry was mired in a prolonged price war, significantly increasing survival pressure on separator enterprises, which showed strong sentiment to stand firm on quotes. On the supply-demand side, although the market is gradually recovering, downstream demand has not shown significant growth, and separator enterprises' operating rates have not significantly increased. Under the dual weak supply-demand scenario, downstream battery cell manufacturers stopped price suppression to ensure supply chain stability, and separator prices remained stable this week. Looking ahead, as new separator capacity gradually reaches full production, the growth rate of downstream demand may struggle to match the pace of capacity expansion, potentially prolonging the oversupply situation. Under such circumstances, fierce price wars may resurface as separator enterprises compete for limited market share.
Electrolyte: Electrolyte prices remained stable this week. On the supply side, market activity resumed after the Chinese New Year holiday, with LiPF6 produced on demand and electrolyte producers shipping goods based on orders, keeping prices stable. On the demand side, battery cell manufacturers showed signs of recovering demand for electrolytes, procuring on demand. On the cost side, prices of LiPF6, additives, and solvents remained stable. Currently, electrolyte prices are mainly influenced by LiPF6 prices. However, due to price suppression by battery cell manufacturers, electrolyte prices remained stable. The prices of ternary power battery electrolyte ranged from 21,100 to 29,550 yuan/mt, while LFP battery electrolyte prices ranged from 16,800 to 25,550 yuan/mt. In the short term, cost fluctuations are expected to cause electrolyte prices to oscillate within a certain range.
Sodium-Ion Battery: Recently, the cost of sodium-ion battery cathodes has shown room for reduction with the commissioning of new capacity and the start of mass production. However, the capacity of hard carbon anodes and electrolytes has not significantly increased, keeping prices stable in the short term. The sodium-ion battery market is currently dominated by layered oxide, but with the cost advantages of NFPP polyanion and the expansion of mass production, it is expected to gradually become the mainstream in the market.
Recycling: Prices of waste batteries for cascade utilization remained stable overall. On the supply side, battery cell manufacturers gradually resumed production, and trader activity increased, leading to a gradual recovery in the supply of waste battery cells for cascade utilization, though still below peak season levels. On the demand side, cascade utilization enterprises gradually resumed procurement of waste battery cells for cascade utilization. However, due to oversupply in the market, upstream enterprises showed sentiment to stand firm on quotes after the holiday. Cascade utilization enterprises were cautious about purchasing high-priced battery cells, generally unwilling to buy at high prices and only making just-in-time procurement. In the short term, prices are expected to remain stable, but market transaction volumes remain sluggish, with weak performance on both supply and demand sides. With the expected growth in battery cell production and retirement volumes in the future, increased supply may lead to further price declines for waste battery cells for cascade utilization.
Supply Side: This week, with the continued rise in nickel salt and cobalt salt prices, prices of ternary and LCO black mass also continued to rise, with powdering plants and traders further raising their psychological price levels. However, the coefficients for ternary and LCO black mass showed little change WoW. For example, most enterprises maintained certain safety inventories for ternary pole piece black mass. Due to long-term cost-price inversion, enterprises showed cautious attitudes toward accepting high-priced black mass, and market transactions were mediocre. On the demand side, the price increases for cobalt salt and nickel salt partially offset the costs of hydrometallurgical plants processing ternary and pure cobalt scrap. However, hydrometallurgical costs remained below the profitability line.
Downstream and Terminal: This week, DC-side battery cabin prices remained stable. The average price for a 5MWh DC-side battery cabin was 0.43 yuan/Wh, while the average prices for 3.44/3.77MWh DC-side battery cabins were 0.438 yuan/Wh. Prices for 280Ah and 314Ah ESS battery cells also remained stable, with overall price fluctuations for DC-side battery cabins being minimal. On February 21, the winning candidates for the EPC general contracting project of the Ulanqab Huade County power grid-side standalone ESS demonstration project in Inner Mongolia were announced. The project plans to construct 100MW/400MWh of ESS in Huade County, Ulanqab, Inner Mongolia, including 90MW/360MWh of electrochemical ESS and 10MW/40MWh of hydrogen ESS. The first candidate's bid was 429.9899 million yuan, with a unit price of 1.075 yuan/Wh. The second candidate's bid was 439.0751 million yuan, with a unit price of 1.098 yuan/Wh. The third candidate's bid was 443.3723 million yuan, with a unit price of 1.108 yuan/Wh.
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News:
【Double-Digit Growth in Multiple Indicators for Lithium Battery and PV Industries in 2024】The Ministry of Industry and Information Technology released the 2024 operational data for the lithium battery and PV industries, showing double-digit growth in multiple economic indicators. In 2024, China's lithium battery industry continued its growth trend, with total production reaching 1,170GWh (1GWh = 1 million kWh), up 24% YoY, and the industry's total output value exceeding 1.2 trillion yuan. Among these, production of ESS lithium batteries hit a new high of 260GWh, up over 40% YoY. Additionally, lithium battery installations for NEVs and new-type ESS exceeded 645GWh, up 48% YoY. The PV industry data released by the Ministry of Industry and Information Technology also showed continuous growth in production across major segments of the PV industry chain in 2024. Production of PV polysilicon, silicon wafers, cells, and modules all grew by over 10% YoY, with the industry's output value maintaining a trillion-yuan scale. In terms of exports, PV cells and module export volumes grew by over 40% and 12%, respectively.
【Two Departments: Support Low-Carbon Transition of the Energy System and Increase Financial Support for Charging Infrastructure】The General Office of the National Financial Regulatory Administration and the General Office of the People's Bank of China issued the "Implementation Plan for High-Quality Development of Green Finance in the Banking and Insurance Industries." The plan mentions supporting the low-carbon transition of the energy system. Banking and insurance institutions are required to focus on the production, construction, and operation of new energy industries such as solar PV, wind power, hydropower, pumped storage, ultra-high voltage, nuclear energy, ESS, smart grids, and microgrids, as well as their updates, upgrades, and renovations. They are to strengthen project connections and credit support, enhance financial risk prevention, and provide full life cycle insurance coverage. The plan also explores improving financial services for NEVs across the entire industry chain and increasing financial support for charging infrastructure. It further explores financial services for biomass energy, geothermal energy, and ocean energy, and promotes the orderly development of hydrogen energy and nuclear power. Based on China's national conditions and the characteristics of the energy industry's low-carbon transition, the plan supports the clean and efficient use of traditional energy. It also aims to ensure energy supply through financial services, meeting the reasonable financing needs of coal-fired power and coal enterprises.
【Fujian: Support Taiwan Residents in Employment Development in Ningde's Lithium Battery Industry】To further address the concerns of Taiwan residents and enterprises, Fujian Province recently formulated the fourth batch of policy measures to implement the central government's "Opinions," covering three aspects with 17 measures. In terms of supporting the better development of Taiwan residents in Fujian, the measures include supporting Taiwan residents in employment development in Ningde's lithium battery industry. Enterprises such as CATL, New Energy Technology, and XTC New Energy Materials (Xiamen) will provide over 100 job positions annually for Taiwan residents over the next three years. Taiwan residents with newly obtained bachelor's degrees or higher who are employed in Ningde, sign labor contracts with employers, and work for more than one year will receive an annual subsidy of 50,000 yuan per person, for up to three years. The measures also facilitate online renewal or replacement of Taiwan Resident Permits. Taiwan residents in Fujian Province who hold Taiwan Resident Permits and have unchanged residential addresses can apply through the "Minzhengtong" App's "Public Security Convenience" or the "Taiwan Residents and Enterprises Digital 'First Home'" section within three months before the permit's expiration, with processing completed within five working days.
SMM New Energy Research Team
Cong Wang 021-51666838
Rui Ma 021-51595780
Ziya Lin 86-2151666902
Ye Yuan 021-51595792
Disheng Feng 021-51666714
Ying Xu 021-51666707
Yanlin Lü 021-20707875
Yujun Liu 021-20707895
Zhicheng Zhou 021-51666711
