Lithium Hydroxide prices remain under pressure on the CME with the spot market continuing to fall, and the futures curve following. The August price now sits at $11.53/kg and the contango further out the curve continues to evaporate. With excess production capacity in Chile and Argentina due to come online 2H this year the expectation is for global lithium output in 2024 to exceed 1.4 mt lithium carbonate equivalent. Of this, 400,000 tonnes is hydroxide product and the remainder being lithium carbonate. On the demand side, downstream includes energy storage and electrical vehicles and should see consumption of about 1.3 mt of lithium carbonate equivalent leaving a 100,000 surplus.
Cobalt metal prices remain weak exacerbated by CMOC’s increasing production capacity. High copper prices have also placed downward pressure on Cobalt prices as Cu-Co mines in DRC continue to ramp up Copper production. Cobalt metal futures prices listed on CME have also fallen with Q4’2024 now trading at $12.10/lb down from $14.00 at the end of June, and similar to lithium the contango has also been sold further out the curve with back end prices coming down over the same time frame.
By Zack Zhang (Broker, Derivatives, Singapore) & Gary Gao (Broker, Derivatives, Shanghai)
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