Despite the first increase in cobalt prices in six months, the future price projection of cobalt remains bearish.

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 For the past few years, the cobalt market has been plagued by a surplus, resulting in a downward trend in prices. Nevertheless, the price of cobalt recently increased slightly, rising from USD 34,180 per ton to USD 34,930 per ton, marking the first upward movement in six months. The price increase was caused by market participants restocking cobalt metal as well as a small increase in demand in the United States. 

 

                                                Cobalt price in USD/per ton over the last 6 months. Source: TRADING ECONOMICS

 Despite this short-term price increase, the cobalt price outlook remains bearish. The primary reason for this is a market oversupply of cobalt, which has resulted in inventory buildup. Supply is expected to increase by 24% overall starting in 2023, while demand is expected to increase by 8%. This oversupply is primarily due to recent increases in production. Despite this, demand for EVs has increased, particularly in China. Though, even with a higher demand the supply will outnumber demand making the price fall.

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