SunSirs: Cobalt Market Demand Fell Short of Expectations

1. Trend analysis

According to SunSirs data monitoring, the cobalt price fell slightly in April. Since March, the cobalt price has dropped sharply. However, since April, the decline in the cobalt market has slowed down and the cobalt price has dropped slightly. As of April 20, the price of cobalt was 24,7000 yuan / ton, which was a decrease of 1.79% from the average price of 25,1500 yuan / ton at the beginning of the month.

2. Market conditions

New energy vehicle sales

On April 10, the latest production and sales data released by the China Association of Automobile Manufacturers showed that the production and sales performance of new energy vehicles in March was significantly better than that of the previous month, and the month-on-month growth rate was rapid. In March, the production and sales of new energy vehicles were completed at 50,000 and 53,000 respectively, up 3.8 times and 3.0 times sequentially, down 56.9% and 53.3% year-on-year. From January to March, the production and sales of new energy vehicles were completed at 105,000 and 114,000 respectively, down 60.2% and 56.4% year-on-year. Sales of new energy vehicles fell sharply. Sales of new energy vehicles picked up in March, but they were still far below expectations, and demand fell significantly. Cobalt market is bearish.

Mobile phone production and sales

According to data from China Information and Communications Technology Institute, in March 2020, the total domestic mobile phone market shipments were 21.756 million units, a year-on-year decrease of 23.3%. From January to March 2020, the total domestic mobile phone market shipments were 48.953 million units, a year-on-year decrease of 36.4%. Mobile phone sales have fallen sharply, and cobalt market demand has fallen sharply. In March, mobile phone sales rebounded sharply from February, but compared with the market expectation of 5G mobile phone replacement, the current performance of the mobile phone market is far lower than expected, and the cobalt market is more bearish.

3. Outlook

SunSirs data analysts believe that the performance of the new energy vehicle market and the mobile phone market have rebounded in March. Demand for the cobalt market has rebounded. The downward pressure on the cobalt market has weakened and the decline in cobalt prices has slowed. However, the performance of the new energy vehicle market is far less than that of the same period last year, and the global auto market has fallen sharply, which is somewhat negative for the domestic cobalt market. The growth of the mobile phone market, especially 5G mobile phone sales, is the main driver of the expected increase in cobalt market in 2020, but the mobile phone market Not only did the sales volume not increase, but on the contrary, it fell sharply. The cobalt market demand was much lower than expected, and the cobalt price increase was insufficiently motivated. At the same time, in the international market, the Congolese gold is affected by the epidemic, and the supply of cobalt mines is expected to decline, which will be beneficial to the cobalt city. However, due to the slow growth of demand, the cobalt market has insufficient momentum to increase, and the cobalt price increase period is uncertain. It is expected that the future market of cobalt will be stabilized and the future market will be stable.

Related listed companies: Huayou Cobalt (603799), Hanrui Cobalt (300618), Luoyang Molybdenum (603993).

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