Cobalt prices rise on enquiries for large forward tonnage
Cobalt prices rose in the last week of June in anticipation of stronger buying in the future, market sources said.
Metal Bulletin’s benchmark low-grade cobalt price rose to $10.75-11.35 per lb on July 1 from $10.50-11.20 on Friday June 24, and $10.65-11.20 per lb on June 29. High-grade cobalt prices rose to $10.80-11.60 per lb from $10.75-11.55 on June 24.
As the second quarter came to an end the focus of some large traders shifted from weighing available supply to quantifying the volume of enquiries for metal over the next two years that they said they have detected in recent days.
"We seem to have got to the end of the second quarter without the producers popping up to sell tonnage," one London-based trader said.
"I have an edict not to sell anything below $11 per lb from this point."
Traders reported relatively large levels of interest, although mostly for forward business.
"We are holding enquiries for over 100 tonnes of metal, some of which is spot, and we would now be offering in the mid-$11s," another UK-based trader said.
Having bought at $10.65 last week, he had made a firm offer at $11.45, he said.
Other traders spoke of yet larger total volumes: one London-based supplier was considering an enquiry for more than 60 tonnes of material for 2017, and another for 100 tpy between 2017 and 2020.
"Forward business over the next 18-24 months has been much more active. Enquiries total about 300 tonnes," a third trader said.
Speculative interest in the cobalt market has increased over the past few weeks with
hedge funds and other private investors looking to take positions, and
traders selling physical options of between five and 20 tonnes against a strike price of $11 per lb in September.
Although speculation in cobalt has been prompted by its usage in batteries for electric vehicles, other sectors, such as super-alloys and latterly alloys related to the oil industry, are also showing good interest, traders told Metal Bulletin.
"It may finally be going to break out of this $10.20-11.50 range that we've seen all year," one supplier said
https://do not advertise external s...e-on-enquiries-for-large-forward-tonnage.html
(20min delay)