The benchmark price for cobalt in Europe has slid more than 13% since a peak in May, and an even sharper decline in Chinese prices signals the sell-off could have further to run. Buyers in the country are racing to renegotiate supply deals in order to stem heavy losses arising from an unusual disconnect between domestic and international prices, according to cobalt traders and buyers.
“What we’re seeing is buyers and sellers working together to make revisions to the pricing terms,” Ying Lu, analyst at Wood Mackenzie Ltd., said by phone from London. “There is still pressure on refiners, but it has eased compared to a few weeks ago.”in April, reflecting the kind of ructions throughout the EV supply chain that have left China’s cobalt refiners exposed to losses on expensive imported raw materials.
“Demand from EV batteries and traditional usage such as in the aeroplane industry is expected to pick up in the next six months alongside subsidies support for EV while travel restrictions ease,” Susan Zou, senior analyst at Rystad Energy, said by phone from Shanghai. “But demand from consumer electronics remains uncertain.”