Battery cathode materials: Correlation
Prices it moves with, and why
Battery cathodes are mostly lithium iron phosphate (LFP) or nickel-manganese-cobalt oxides (NMC). Their prices are set by formulas that pass through lithium, nickel and cobalt costs plus a processing fee, so metal markets dominate.
No public price Battery cathode materials has no public monthly price series: Sold on negotiated contracts linked to metal prices; no public index here.What its price moves with
Every cathode chemistry needs lithium carbonate or hydroxide, and supply contracts often index cathode prices to published lithium quotes. The 2022 lithium spike and its collapse through 2023 moved cathode prices more than any other factor, especially for LFP.
No public price for lithium, so the link is explained in words only.High-nickel NMC cathodes use nickel sulphate made from Indonesian and other nickel. Nickel is therefore a direct cost for NMC, while LFP avoids it, which is one reason carmakers shifted towards LFP when nickel prices were high.
Not enough overlapping price history to measure.Cobalt stabilises layered NMC cathodes but is costly and concentrated in the Democratic Republic of Congo. Price spikes and supply worries pushed makers to cut cobalt content, so its weight in cathode cost has fallen over time.
No public price for cobalt, so the link is explained in words only.LFP cathodes are made from purified phosphoric acid or iron phosphate. Battery-grade acid competes with fertiliser for phosphate rock, so a fertiliser boom can raise LFP input costs, though lithium remains the larger driver.
Not enough overlapping price history to measure.LFP cells use the cathode as their largest single material cost, so falling cathode prices feed directly into cheaper cells for EVs and grid storage. This link explains much of the steep fall in cell prices since 2023.
Not enough overlapping price history to measure.NMC cells carry more expensive cathodes than LFP because of nickel and cobalt, which is why NMC packs cost more per kilowatt-hour. Their pricing therefore stays closely tied to the nickel and cobalt markets.
Not enough overlapping price history to measure.How to read these numbers
Correlation of monthly changes (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak.
12-month changes compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs.
Price function is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation.
Lead or lag checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months.
Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link.
Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site.