Ni & Co CONFERENCE: High cobalt prices boost cobalt recycling in China; EV battery recycling takes time

The Chinese market has witnessed a cobalt recycling boom in the past year as a result of high cobalt prices, although the establishment of a truly comprehensive and efficient recycling system is still some way off, Fastmarkets learned from a cobalt panel discussion in Xiamen, China.

“The rally in cobalt prices has provided a lot of incentive to [cobalt] recycling businesses, and sped up the establishment of a recycling system [in China],” Ou Hancheng, general manager of Ganzhou Highpower Technology told the delegates at Antaike’s Nickel & Cobalt Conference on November 8.

“It is very hard for me to give a precise number in terms of how much cobalt is being recycled this year. There might have been about 10,000 tonnes per year of cobalt recycled [in China] a few years ago, but it must be much more than that this year,” Ou told the delegates.

“After cobalt prices rose so quickly a lot of invisible inventory [of cobalt scraps] started to come into the market,” Ou noted.

Cobalt prices have maintained a strong upward momentum since mid-2016 amid a positive outlook on electric vehicle (EV) development and resultant battery consumption.

Fastmarket MB's assessed low-grade cobalt price hit an almost ten-year high of $43.7-44.45 per lb in late April. Although the price softened afterwards and was assessed at $33.5-34.45 per lb on November 7, the most recent pricing session, it is still much higher than its 15-year low of $9.2-11.4 per lb witnessed in December 2015. 

The popularization of smart phones has helped to drive the course of battery recycling, according to Ou.

“Customers have to go to the maintenance stores to replace their smart phone batteries, which will be stored and then distributed to the recycling chain,” Ou said.

Hard alloys, another key consumer of cobalt, have been largely recycled in the past few years, according to Zhang Huazhu, marketing director of the powder division of Xiamen Golden Egret Special Alloys.

“A few [hard alloys] producers outside China have already been feeding on recycled cobalt and tungsten from hard alloys scraps, which have accounted for about 70% of their feedstock,” Zhang told the delegates.

“As cobalt prices climb, producers [feeding on cobalt] will try to come up with measures [to lower their production costs],” Zhang said.

EV battery recycling boom will take time
Recycled cobalt is mostly generated from consumer electronics scraps at the moment, although EV battery scraps will account for a greater percentage of recycled cobalt following the large-scale penetration of EVs, Xu Aidong, general sectetary of the China Non-ferrous Metals Industry Association (CNIA) Cobalt Branch said. 

Currently around 80% of the cobalt scraps supply [in China] comes from consumer electronics, 10% from EV batteries, and the  remaining 10% comes from other sources, Ou told the delegates.

“Current cobalt recycling still relies on consumer electronics scraps as the quantity of EV battery scraps is still small,” Ou said.

In addition, an immature recycling system and poor regulatory framework in China have created difficulties for the efficient recycling of EV batteries, Ou pointed out.

“Some regulations haven’t been properly implemented, and a lot of EV battery scrap has flowed into the secondary market [which cannot recycle cobalt efficiently],” Ou said.

Chinese EV battery recycling will accelerate once relevant EV battery recycling regulations are completed and strictly implemented, and clear guidance is given in terms of how to process EV battery scraps, according to Ou.

Susan Zou

susan.zou@metalbulletinasia.com

Published

Susan Zou

November 09, 2018

08:56 GMT

Xiamen