SunSirs: With Weak Demand and the ‘Buy on the Rise, Not on the Fall’ Mentality, Cobalt Prices Plunged in June

Cobalt prices plummeted in June

According to the SunSirs cobalt market analysis system, the price of cobalt stood at 398,200 RMB/ton on June 12, marking a 6.00% decline from the 423,600 RMB/ton recorded on June 1. In early June, the domestic cobalt market experienced a sharp drop, with the price of electrolytic cobalt falling by as much as 8,000 RMB/ton in a single day and a cumulative monthly decline of 6%. Following the rapid price drop, most traders suspended quoting prices; regarding demand, the sustained downward trend dampened downstream purchasing interest, with alloy and magnetic material enterprises—adopting a "buy on the rise, not on the fall" mentality—largely choosing to delay purchases and adopt a wait-and-see approach. Consequently, some market participants were forced to exit positions to cut losses, further exacerbating the price decline.

Supply side: Prices of cobalt raw materials fell

In June, prices for cobalt salts and raw materials softened slightly. The approval process for Q1 2026 quotas remained slow due to procedural complexities; compounded by tight local transport capacity in the Democratic Republic of the Congo (DRC) and the low priority assigned to cobalt raw material shipments, the arrival of large cargo volumes was further delayed—pushing bulk arrivals into the second and third quarters. With weak demand-side support, there was insufficient momentum to drive up cobalt raw material prices.

As the mid-year mark approached, some enterprises offered price concessions to alleviate pressure regarding financial results and capital recovery, thereby intensifying bearish market sentiment. However, given sluggish end-market orders and a general lack of downstream restocking momentum, these price cuts failed to generate any substantial increase in orders. Leading enterprises maintained a firm stance on pricing, unwilling to sell at low levels, which provided a floor for prices. Overall, while the downward trend in cobalt prices accelerated in June, a price floor remained in place.

As the backlog of cobalt intermediate products from the DRC arrives in bulk, the supply-demand balance for cobalt raw materials will temporarily shift toward inventory accumulation, placing downward pressure on prices. June marked the final month of the second quarter, and the increased volume of cobalt raw materials arriving from the DRC exerted downward pressure on prices.

Demand side: Demand was under pressure, and growth had fallen short of expectations

In the consumer electronics sector (high-end smartphones and laptops), forecasts for annual shipment growth have been generally revised downward due to the high cost of key components, directly dampening demand for lithium cobalt oxide cathode materials.

Growth rates for the production and installation of ternary batteries have slowed both year-on-year and month-on-month, while the substitution effect of lithium iron phosphate (LFP) continues to manifest; downstream purchasing is driven primarily by essential needs, with sluggish trading in spot orders. Consequently, cobalt demand for ternary batteries has fallen short of expectations.

The rapid development of the low-altitude economy—exemplified by drones and eVTOLs—is opening up incremental markets for high-end cobalt(II,III) oxide. However, lackluster growth in these emerging markets through 2026 offers limited support for cobalt prices.

Market Outlook

Analysts at SunSirs believe that while the recent sharp drop in cobalt prices has sparked market concern, a supply deficit persists for the second half of the year; the short-term pullback in June appears to be a periodic adjustment with limited downside potential. Factors such as quota approvals for the Democratic Republic of the Congo (DRC) and the actual arrival times of intermediate products provide a price floor, while the trend toward higher prices hinges on whether demand from the consumer electronics and new energy vehicle sectors rebounds as expected during the peak season. Although the release of new production capacity in Indonesia may temper the upward momentum, it is unlikely to alter the overall price trend. Consequently, cobalt prices are expected to experience a slight, fluctuating decline in the near future.

SunSirs has been continuously tracking price data for over 200 commodities for nearly 20 years, please contact support@sunsirs.com for subscription.