Core Viewpoint - The extension of the cobalt export ban by the Democratic Republic of Congo (DRC) is expected to lead to a significant increase in cobalt prices, similar to past occurrences, impacting both the domestic cobalt market and related stocks. Group 1: Market Reactions - The DRC's strategic mineral market regulator announced a three-month extension of the cobalt export ban, causing a sharp reaction in the domestic cobalt product and securities markets, with companies like Hanrui Cobalt and Huayou Cobalt seeing notable stock price increases, and Tengyuan Cobalt rising over 15% [1] - On June 23, the price of 1 cobalt in the Changjiang spot market surged by 22,000 yuan to 256,000 yuan per ton, marking the largest single-day increase in nearly a decade [1] - Other cobalt products, including electrolytic cobalt and cobalt tetroxide, also experienced price increases ranging from 5,000 to 9,000 yuan [1] Group 2: Supply Chain Impact - Currently, the price increase is concentrated in the upstream of the supply chain, with no significant transmission to downstream lithium cobalt oxide battery materials, as prices remain stable and purchasing sentiment is cautious [2] - The DRC's previous export ban in February led to a rapid price rebound for electrolytic cobalt, which rose from approximately 162,500 yuan per ton to 247,600 yuan within a month [2] Group 3: Future Supply and Demand Dynamics - The extension of the export ban has prompted a reevaluation of the supply-demand relationship in the cobalt industry for the year, with the DRC expected to produce 220,000 tons of cobalt in 2024, accounting for 76% of global production [4] - According to CITIC Securities, the ban could affect the DRC's cobalt export volume in 2025 by 128,000 tons, potentially shifting the global cobalt market from oversupply to a shortage of 78,000 tons, which may trigger a new wave of price increases [4] - The three-month shipping period from the DRC to China means that the impact of the previous export ban on domestic supply will only be felt gradually, with the current extension increasing the risk of raw material shortages for domestic smelting companies [4][5] Group 4: Long-term Outlook - The export ban is expected to create only a temporary supply contraction rather than a fundamental shift in long-term supply-demand dynamics [6] - Major cobalt producer Luoyang Molybdenum Co. stated that their production operations remain normal and that the extended ban is not expected to significantly impact their financial performance [7] - Even if cobalt prices rise to 300,000 yuan or 400,000 yuan per ton, the resumption of cobalt exports from the DRC would likely lead to a price decline, indicating that the DRC's export policies are a key variable influencing cobalt price trends this year [9]

Core Viewpoint - The surge in cobalt prices is driven by inventory consumption and supply chain disruptions due to the Democratic Republic of Congo's export ban on cobalt for four months [2][6]. Cobalt Price Surge - Following the export ban, cobalt prices skyrocketed from 162,000 CNY/ton to over 260,000 CNY/ton, marking an increase of over 60% within 20 trading days [2]. - Historical price trends indicate that cobalt prices typically range between 200,000 to 300,000 CNY/ton, with potential spikes to 500,000 CNY/ton or even beyond 600,000 CNY/ton due to supply chain instability [2]. Demand and Application - Cobalt's primary application is in batteries, with the electric vehicle sector accounting for 45% of global cobalt demand and consumer electronics for 26% [3]. - The volatility in cobalt prices directly impacts the cost of batteries for electric vehicles and consumer electronics, with the current price fluctuations still in the early stages of development [3]. Impact on Battery Costs - The cost of battery materials, particularly for ternary precursors and lithium cobalt oxide, has significantly increased, with price hikes of 30% for 523-type precursors, 28% for 622-type, and 8% for 811-type precursors [4]. - The rise in cobalt prices is expected to increase the cost of ternary battery cells by approximately 5%, which may lead to a 2% increase in the final price of electric vehicles [5]. Market Dynamics - The market currently lacks clear expectations for cobalt price trends, with recent price fluctuations indicating a state of market speculation [6]. - In 2024, global cobalt production is projected to reach 290,000 tons, a 22% increase, while demand growth for lithium batteries and consumer batteries is expected to be limited, leading to a potential surplus of over 50,000 tons [6]. Inventory and Supply Chain - As of the end of 2024, China's cobalt raw material inventory is approximately 53,000 tons, corresponding to a three-month consumption volume, indicating a tight inventory situation [7]. - The export ban from the Democratic Republic of Congo may lead to a shift in cobalt imports to Southeast Asian countries like Indonesia, which is expected to see an 80% increase in cobalt production to 32,000 tons in 2024 [7].