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Highlights
- Global cobalt supply faces disruption from key producers
- Prices surge amid export suspension in the DRC
- EV sector set to feel the ripple effects
Global cobalt markets are bracing for significant turbulence following the Democratic Republic of the Congo's (DRC) decision to restrict cobalt exports, a move that could deeply impact electric vehicle (EV) supply chains and battery manufacturing industries worldwide.
The DRC, which alongside Indonesia accounts for over 85% of the world’s cobalt production, has suspended exports of the critical mineral since February 2025. This decision is part of a broader effort by the two nations to explore strategic cooperation on cobalt and nickel exports. The suspension does not include a halt in production, which has led to the accumulation of stockpiles awaiting clearance for shipment.
DRC Prime Minister Judith Suminwa Tuluka confirmed that cobalt production quotas are now in place, alongside strict controls on existing inventories. Market responses have been swift—since the February announcement, cobalt prices have surged by 84%, reflecting growing concerns about tightened supply.
Analysts highlight the significant impact of this export pause on China, the world's leading refiner of cobalt intermediates. During the final four months of 2024, the DRC shipped nearly 68,000 tonnes of cobalt in hydroxide form to China. The abrupt halt in this flow has disrupted processing operations, which may accelerate the depletion of current inventories in the absence of fresh imports.
Meanwhile, the growing global appetite for cobalt, largely driven by the booming EV industry, adds further pressure. Lithium-nickel-manganese-cobalt-oxide (NMC) batteries—a mainstay in electric vehicles—contain 10–20% cobalt in their cathodes. Grand View Research valued the global cobalt market at $26.96 billion in 2024 and projects a compound annual growth rate of 6.7% through 2030, fueled by increasing EV production.
As Indonesia positions itself as a more critical player in cobalt intermediate supply to China, companies engaged in battery materials and EV production are closely monitoring the developments. For instance, Tesla (NASDAQ:TSLA), a leading EV manufacturer, and Glencore (LSE:GLEN), a major cobalt producer, may need to adjust supply chain strategies in light of the shifting cobalt landscape. Battery manufacturers like Contemporary Amperex Technology Co. (SHE:300750) are also likely to be affected by the evolving dynamics between the DRC, Indonesia, and China.
As the global race for energy transition accelerates, supply chain resilience for critical minerals like cobalt becomes ever more crucial. Industry stakeholders are now recalibrating their sourcing strategies and evaluating alternative pathways to mitigate the risks stemming from geopolitical and regulatory developments in key cobalt-producing regions.
