Looking at the reports as we have had from some of the dated reports on some of the most common lithium battery processors, cobalt sulphate in particular, we see that there has been a surge in the prices by some significant percentages over the recent past. As have as well been followed by Benchmark Mineral Intelligence, the prices for cobalt sulphate have been on the rise over the past years. This has been in a way attributed to the fact that there has as well been an increasing on the demand of lithium ion battery in the industrial sector. It is in the Chinese market that we have seen such a significant increase in the prices of the cobalt sulphate with the prices averaging way over $13000 for every tonne of the material. Looking at the rise in the prices, there has to be a reason to explain this and this is given in a number of versions of the reasons. Below are some of the reasons why you will see this stickiness in the rise of the prices of the cobalt sulphate as a material for the making of lithium battery.
First and foremost, one of the reasons is the fact that there has been a steady increase in the demand for the Lithium ion battery cathode. One of the reasons that has seen this increase has been the increase in the demand for this product by the manufacturers for the lithium ion battery cathode which effectively has translated to explain the rise in the prices for the product. As a matter of fact, the largest share of the market and demand for cobalt sulphate is actually taken by the demand for this by the lithium ion battery manufacturing sector. And as per the reported forecasts by Benchmark Mineral Intelligence, this demand is even projected to increase over the next coming years to hit all-time highs. This is actually an issue that has been in their discussion in their inaugural conferences.
The other reason that has been seen to explain the rise in the prices of the sulphate has been that of the fact that the refining capacity has been restricted by environmental limitations. Most of the refiners in China have still remained under scrutiny and environmental checks by the authorities in the country, China. Most of these requirements have seen them subjected to ensuring that the emissions and effects that come from the process of manufacture do not actually get to interfere with the environment in any way. All these installations will definitely come in costs that will eventually passed on to the end users in this tight economy.
One more reason why this has been, the rise in the prices of the commodity, cobalt sulphate, has been the ending of the lower cost cobalt in the supply chain.