COBALT

Cobalt has been used for thousands of years as a blue coloring agent in pottery, glass and ceramics. However, in recent years demand from more high-tech sectors has emerged — today cobalt is used in batteries, alloys and more.

The battery sector in particular has become an important source of cobalt demand. Demand for lithium-ion batteries, which require cobalt, is surging, and this demand is expected to drive the cobalt market in the coming years. At the same time, cobalt supply could tighten substantially due to human rights abuses in the Democratic Republic of Congo (DRC), where most cobalt is produced.

There’s also been speculation about a possible civil war as well as an ebola outbreak in the DRC, leading to more talk of supply shortages on the horizon.

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Cobalt is mainly produced as a by-product of nickel and copper, and as mentioned the DRC supplies the bulk of the world’s cobalt. Most cobalt in the DRC comes from an area known as the Copperbelt. It holds one-third of global cobalt reserves and accounts for 40 to 50 percent of cobalt output in the DRC.

The DRC produced 64,000 MT of cobalt in 2017, far ahead of Russia’s 5,600 MT. The Eastern European nation was the world’s second-largest cobalt producer that year, while Australia and Canada were the third and fourth largest, respectively. Cobalt is currently produced in about a dozen countries worldwide.

As noted above, cobalt from the DRC is facing increasing scrutiny. While cobalt is not officially a conflict mineral, some human rights groups are pushing for it to receive that designation. Many DRC cobalt operations are dangerous and poorly managed, and these groups believe that cobalt end users should be sourcing the metal elsewhere.

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https://investingnews.com/daily/resource-investing/battery-metals-investing/cobalt-investing/introduction-to-cobalt-investing/