General Discussion AGY, page-17195

Imo there is not enough data or info to draw the types of conclusions that you/others have about China spot prices vs other prices wrt cause and effect / lead / lag etc.
One critical factor here is the timing of contracts and the protraction required for price adjustment.
For example:
Demand increases, volume on the spot market is under pressure and therefore spot prices rise. This happens “instantly”. Contract prices may also rise but it takes longer due to prices only being renegotiated every qtr / 6-months / year etc.

Imo one cannot draw the conclusion that contract pricing will simply be the spot price with a “6-month lag” or something like that.
Firstly, the above supply-demand dynamic requires a particularly lengthy trend to have such influence: i.e. imagine a 1-month price doubling spike next month in the spot price (for whatever reason), then a return to the current level…. Would we see a similar st spike in contract pricing in 6/12 months time ? No. It is far more complex than this, afaict.
Cause-effect is not clear. Timing/trend/persistence play important roles, afaict.
The markets are different. The product is different.
The volumes are very different.
Key factor imo is simply supply-demand vs timing of contract negotiations.
Pricing formulas aren’t clear afaict.
Does anyone have any examples of pricing formulas?

Imo “the market” is young and dumb, and has demonstrated its inability to “value” related companies, not to mention the gross incompetence (and deception) of so-called experts/analysts when it comes to forecasting pricing, valuations etc etc.
The BEOT love this and prey on it hard while they strip money from the vast majority of retail.
Just read all the headlines about “the lithium price” as a good example. Short term spot pricing effectively multiplying (or smashing) the sp of juniors who are years away (if ever) from production..? Laughable!
Fear and greed being shouted from the rooftops!
Psychology 101 ensuring most traders lose money overall.

In the background…. It’s still just TICK TOCK despite all the noise….

Summary: predicting contract pricing (magnitude and even direction) from st spot prices is risky and based on insufficient data and precedent.
afaict the market overlap is minimal eg, can a customer flick their 10ktpa contract from supplier x and simply go buy that on the spot market instead? Not afaik. Too much specificity of product and not enough volume + consistency on the spot market afaict.
Interesting and very complex! Purposefully opaque too!

IMO
Dyor