CLA - Cobalt related news, page-3174

Will there be a new uplink cycle for cobalt lithium, a new energy vehicle, resurrected by the Ministry of Finance?

Supply and demand may be reversed
There is no doubt that the fact that the supply of cobalt and lithium has far exceeded market demand in the past two years is an important reason for the fall in prices. The news that Glencore's Mutanda cobalt mine will be closed for two years in August breathed the market, starting a small rebound in cobalt prices. Data show that Mutanda, as the world's largest cobalt mine, produced 27300 tons of cobalt in 2018, accounting for 18 percent of the world's total production.

Xie Honghe said that the shutdown of Mutanda means that the global supply of cobalt will be directly reduced by more than 25000 tons per year over the next two years. In this way, from the point of view of the new supply of other mines, the new supply of cobalt will be only 1-15000 tons per year in the next two years, and this new supply will not be able to meet the new demand in the market.

First, for new energy vehicles, the consumption of cobalt by power batteries this year is about 20,000 tons. If the growth rate for the next two years is calculated on the basis of 50%, the consumption of cobalt will reach about 40,000 tons per year. The new demand will reach 20,000 tons. The other is in the 3C field, 5G mobile phones in the next two years will usher in a wave of upgrading, at the same time, TWS and other related industry chain will also lead to the demand for cobalt, it is expected that in the next two years, 3C field will bring new demand for cobalt will be more than 10,000 tons.

Superimposed, the two main demand growth points of new energy vehicles and 3C can basically lead to about 30, 000 tons of new demand for cobalt each year, while the actual annual new supply of cobalt is 1-15000 tons. From this point of view, the gap between supply and demand of cobalt is still very obvious.

At the same time, from a cyclical point of view, there will be inventory replenishment, the premise of inventory replenishment is the amplification of demand expectations. In the past 15-17 years, China's new energy vehicle market demand broke out, the industry chain manufacturers entered the inventory replenishment cycle, and in 2020-2022, overseas new energy vehicles will also usher in the outbreak cycle, the global new energy vehicle market demand is expected to be re-enlarged, which will also promote the upstream cobalt lithium to enter the replenishment cycle again.