TU-TESL

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In March last year, the price of cobalt hit a nearly 10-year high of US $100000 per ton, and then it fell all the way. In August this year, Glencore decided to seal the world's largest cobalt mine, which injected new vitality into the market, but so far, the market response has been relatively moderate, with the price of cobalt hovering around $30000. Although LME's Cobalt price did not change, benchmark mineral intelligence's October cobalt price assessment showed that sulfate prices rose 2.3% month on month, while hydroxide (usually containing 20-40% cobalt) prices rose 9.2%. Prior to Glencore's action, the benchmark cobalt hydroxide price was set at $17050 per ton. October's valuation was $26400 a tonne, which means prices have risen by more than 50% since then. In the third quarter, the volume of hydroxides and concentrates increased by 28% over the June quarter. At first glance, the report seems to be good news for cobalt bulls, but benchmark metals warned that a better pricing environment is not "Fundamentals up, but" largely reflects improved average metal pricing (an important factor in determining hydroxide prices), rather than an increase in market demand. ". In October, Glencore promised to sell about a quarter of its annual cobalt production to gem, a Chinese battery manufacturer, over the next five years. The Barr, Switzerland based company will sell at least 61200 tonnes of cobalt hydroxide to gem between 2020 and 2024. Benchmark pointed out that this transaction, together with the supply agreement announced by Glencore and Belgium's Umicore in May 2019, "may lock in more than 85% of Glencore's cobalt production in the Democratic Republic of Congo in 2020: if the cobalt consumers want to obtain traceable hydroxide, it may be difficult to find enough quantity if they are not in the gem or Umicore supply chain. Glencore is one of the few large industrial producers in the Democratic Republic of the Congo, which can supply traceable cobalt that does not need to be mined by hand. Due to the dominance of the Democratic Republic of the Congo (which accounts for more than two thirds of global production and most of reserves), strengthening the review of the cobalt supply chain is beneficial to cobalt explorers in other parts of the world, and conflict free cobalt may attract price premiums in the future.