(Yicai Global) Nov. 22 -- Shares of Huayou Cobalt and Ronbay New Energy Technology jumped after China’s top supplier of ternary lithium battery and the producer of electric car battery cathode materials signed a long-term strategic cooperation agreement.

Huayou Cobalt [SHA: 603799] rose by the 10 percent exchange-imposed limit to CNY131.12 (USD20.55) today, while Ronbay [SHA: 688005] closed up 10 percent at CNY132.05, after earlier surging by as much as 15.5 percent.

Ronbay will buy ternary lithium battery precursor materials from Huayou Cobalt from next year to 2030, per statements the pair released on Nov. 19. The Ningbo-based firm will buy 415,000 tons in the first four years, while the volume for the following five will be negotiated in the future.

Based on current prices of ternary precursor materials, which vary between CNY80,000 and CNY100,000 (USD12,530 and USD15,660), the deal is worth CNY3.3 billion to CNY4.2 billion (USD517 million to USD658 million).

Huayou Cobalt, also based on Zhejiang province, will provide Ronbay with a preferential pricing method for nickel, cobalt, and manganese, as well as competitive precursor processing charges, they said.

The pair also plans to establish long-term cooperation to develop nickel, cobalt, and precursor technology and product supply. Giving play to their advantages, Huayou Cobalt and Ronbay aim to create a competitive lithium battery ternary cathode material industrial chain, increase market share, and improve operating performance, they said.

Editor: Futura Costaglione