The impact of U.S. tariffs and China's export controls has increased volatility in raw material prices, resulting in mixed reactions within the domestic industry. Prices of critical materials for batteries, such as nickel and lithium, have fallen, while prices of rare metals like copper, silver, platinum, and antimony have surged.
According to the Korea Mine Rehabilitation and Mineral Resources Corporation (KOMIR) on the 26th, the price of nickel traded on the London Metal Exchange (LME) was $14,745 per ton as of the 24th. It has fallen to below one-third of the $48,000 recorded on March 2022.
The decline in lithium prices is even more pronounced. The price of lithium carbonate (lithium refined material) on the Shanghai Metal Exchange in China was 58.50 yuan per kilogram as of the 19th, marking the lowest level in four years and five months since January 2021, and is now one-tenth of the price at the end of 2022 (600 yuan).
Nickel and lithium are essential raw materials for battery manufacturing, and the decline in prices is attributed to reduced demand for electric vehicles and oversupply in China. The drop in nickel and lithium prices has deepened concerns within the battery and battery materials industries. The price of batteries and materials is linked to raw material prices, resulting in a situation where products made with expensive raw materials are sold at low prices.
As a result of the tariff policies of the Donald Trump administration, copper prices are on the rise. Concerns that tariffs may be imposed on copper following steel and aluminum have led to increased demand to stockpile copper. The spot price of copper on the LME has risen over 15% to $10,035 per ton, compared to $8,685.5 at the beginning of the year.
With rising copper prices, the wire and smelting industries are expected to benefit. Most wire and smelting companies enter into contracts that apply the price increase in copper to the selling price through escalation clauses linked to price changes. There are also projections that copper prices will rise further due to increased electricity demand as the artificial intelligence industry gains attention.
Prices of silver and platinum, classified as precious metals, are also soaring. On the New York Mercantile Exchange (COMEX), the price of silver futures reached $37.02 per troy ounce (approximately 31g) on the 10th, marking the highest level in 13 years. Platinum prices have risen by more than 20% just this month, attributed to increased demand in China and a preference for safe assets.
Silver is used as an industrial metal in solar panels, electronics, and the medical sector, while platinum is used in automotive components such as exhaust gas purification devices or aircraft parts.
With China's export controls leading to rising prices for rare metals, including antimony, there are projections that profits for domestic smelting companies will increase. The price of antimony, used in semiconductors, batteries, and defense, was $32,500 per ton as of the 24th, which is an increase of about 95% compared to the same period last year. China's Ministry of Commerce has been controlling antimony exports since September of last year in response to the U.S. trade war.