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Influence of the RC Industry Caused by Cobalt Price Increase

Discussion in 'Drone Lounge' started by betty, Feb 5, 2018.

  1. betty

    betty Member

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    Mar 27, 2017
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    Posted by betty, Feb 5, 2018 #1
    Cobalt price has been dramatically raised since 2017. Due to the intense demand and supply relationship, Cobalt price still seem to increase in the next two years. Cobalt is the most important raw material in RC batteries.

    Cobalt Price Raising Trend

    Tight supplies continued to push cobalt prices higher in the week ending Friday, January 26, 2018. Raising price of cobalt began in early 2017 and this trend has been carried onto 2018. As a major part of the Lipo battery material, the increase in Cobalt price is having strong effect on the Lipo battery pricing and related RC fields.

    Source: http://batteryuniversity.com

    Cobalt increased 2,500 USD/MT or 3.24% to 80,000 on Tuesday January 30 from 80,000 in the previous trading session. Historically, cobalt reached an all time high of 80000 in January of 2018.

    Source: TradingView

    Cobalt prices are likely to rise significantly in the next two years as the industry struggles to meet rising demand from batteries used in electric vehicles, BMO Capital Markets said.

    Effects to the RC industry

    Li-po batteries are consumables in day to day RC activities. The raise of cobalt directly affects the cost of RC hobby itself. In order to maintain our high standard of the use of raw materials, Gens ace have to reduce the profit, at the same time also go through only a small percentage of 10% price raise across the product line. There’s possibility of another adjustment to be made including Tattu batteries depending on the cobalt price in the future.

    Actions taken by some suppliers

    Some suppliers choose stay with the current price or event discount on products in order to win the price war. However due to the huge change of the raw material it’s impossible to make a profit. Many will substitute lower quality raw materials for cobalt to cut down the cost. Choosing a reliable brand like Gens ace for your RC batteries is quite important at this moment.

    Tips for RC fans

    With many uncertain factors, whether or not the price raise of raw material price could bring in a large scale of manufacturer’s price increase, still remains to be seen. From the consumer’s point of view, stocking up your RC consumables can be a very tricky question.

    In total, there was a 60% increase to Cobalt price after 2017 and another 30% increase took place in just the first month of 2018. To avoid another round of price increase in the near future, it seems to be a best solution now to plan your consumption and stock up what you need for the next racing season for rest of the year.

    New material has been discovered by scientists to place the cobalt to resolve the shortage of raw material issue, such as graphene, iron etc. Of course, lab results and testing are a long way from the final product.

    For general RC fun, it could be wiser to wait until you actually need to restock despite the increase of battery cost. In addiction, it also saves you from battery maintenance while storing in the shelf.

    Conclusion:

    Cobalt price will still be in rising trend in the near future. There is no sign to show when and where the trend will stop. What is your opinion on the cobalt price increase? Join in the discussion.
     

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  2. packnrat

    packnrat Member

    Posted by packnrat, Dec 6, 2018 at 4:16 AM #2
    i will hate to see the cost of lipo batteries for rvs in three years, they are $1,000.oo usd and up. each now, and need a min of four (4).
     
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