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May 25, 2015

The CDI Conference: What We Learned About the Cobalt Market

Sentiment at the CDI conference this month was upbeat amid anticipated supply shortage. Here is a summary of what we learned.
  1. Most market participants expect higher cobalt prices before the end of this year. Major traders see prices at $13.5-15 per lb if Chambishi Metal resumes production at the end of June, and at $14-16 per lb if the closure lasts longer.
  2. Closure at Chambishi may last for “at least” three months and may last longer than expected, according to sources. Some market participants are predicting a permanent shutdown of the operation.
  3. China’s cobalt metal imports have been low this year, with ENRC not supplying on long-term basis due to the closure at Chambishi. Ambatovy meanwhile is selling robust volumes around the world.
  4. Jinchuan Group is planning to reduce its cobalt metal output by around 16% to 3,200 tonnes this year, according to an official heading Jinchuan’s nickel and cobalt operations.
  5. China’s cobalt consumption is expected to rise by 13% to about 4,300 tonnes this year, according to an Antaike analyst.
  6. Battery makers in South Korea and Japan have both reported solid demand from the automobile sector, with one Japanese major company expecting a surge of 70% for battery demand in the next two years.
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May 21st, 2015, Cobalt is About to See New Cycle of Shortage
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May 29th, 2015, President's Letter to Shareholders