Dongxing Securities visits Asian Metal

Lin Yang, manager of Dongxing Securities’ Shanghai Research Department, visited Asian Metal on the afternoon of 26 July, and conducted in-depth communication with Carol Lin, analyst of cobalt and lithium markets, and Vivian Pang, senior analyst of the rare earth market on relevant market conditions.

Firstly, Carol introduced the raw material supply in the current lithium market, capacity release of lithium salt producers, downstream anode material plants and cobalt salt market conditions to Mr. Lin. China’s lithium salt capacity is relatively abundant and lithium salt supply is mainly restricted by spodumene supply; the Chinese market witnessed increasing supply of Australian origin spodumene since early this year with newly added supply in H2 of this year, and China’s lithium salt capacity will be released gradually in H2. As for anode material, domestic capacity will be released progressively in Sep-Oct. Overall supply of cobalt ore in the international markets is relatively limited and is mainly centralized in Congo; with the releasing capacity of anode material, it is anticipated that cobalt prices will pick up gradually after September.

Subsequently, Vivian introduced the recent price trend of PrNd products and her perspectives of the market outlook to Mr. Lin. She believed that prices for PrNd products have fallen to a record low after decreases from H2 of 2011 to 2016. Driven by the normalization of cracking down on speculation and profiteering and environmental protection inspections from MIIT, PrNd prices pick up substantially since early this year and are still expected to move up recently; however, rises in prices have exerted no significant influence on end customers at present, but prices will be confronted with risks of declining in Q4 if soaring continuously. Mr. Lin expressed that demand from the new energy vehicle industry shows a year-by-year uptrend, but it still needs to watch whether the uptrend will support prices for raw materials such as PrNd to go up continuously.