Cobalt Institute: Cobalt Market Shifts to Shortage

According to MiningWeekly, citing Reuters, a research report released by the Cobalt Institute on Wednesday predicted that cobalt demand would grow faster than supply, with the surplus in 2024 easing and turning into a shortage in the early 2030s. The report was completed by Benchmark Minerals Intelligence.

In the short term, the future of the cobalt market will depend on the actions of the DRC, the world's largest cobalt producer. At the end of February, the country decided to implement a temporary four-month export ban. Cobalt is a key material for lithium battery production in EVs.

At the end of February, cobalt prices fell to their lowest level in nine years. To address the market surplus, this central African nation implemented an export ban. Since then, cobalt prices have risen by 60% to $16/lb.

Aside from the uncertainty brought about by the DRC's export ban, global cobalt supply is expected to grow at an average annual rate of 5% over the next few years, with the DRC's share of the global market decreasing from 76% last year to 65% before 2030, as Indonesia's cobalt production rapidly increases, with its share rising from 12% to 22%.

Meanwhile, driven by the development of the EV market, global cobalt demand (excluding government inventories) is projected to grow at an average annual rate of 7%, reaching 400,000 mt by the early 2030s. In 2024, global cobalt consumption will reach 222,000 mt.

Before 2030, the proportion of cobalt used in EVs will increase from 43% in 2024 to 57%, as the growth in demand from smartphones, laptops, superalloys, and other industrial uses slows down.

The report stated that in 2024, the cobalt market would have a surplus of 36,000 mt, accounting for 15% of demand, compared to 25,000 mt in 2023.