The action to take 25,000 tonnes per year of cobalt (contained in hydroxide) out of the market has fundamentally changed the supply picture for next year. Prices for cobalt metal, intermediates and salts all moved considerably in the month immediately after the announcement and consolidated those gains in September.
The cobalt market had been expected to sit in a surplus until at least 2023, pending a meaningful uptick in consumption from the battery and electric vehicle (EV) sector. In light of the Mutanda news, Fastmarkets’ battery raw materials research team expects a surplus of 14,000 tonnes in 2020, coming back into balance in 2021.
With that in mind - and automakers and battery manufacturers eager to demonstrate that they can and have locked in supply to satisfy their EV production targets - discussions around 2020 contract terms are already underway.
Here, at the beginning of the annual mating season, Fastmarkets...