SMM, Sept. 17: according to Bloomberg, the Democratic Republic of the Congo will declare cobalt a strategic metal and impose a 10 per cent tax on producers, including Glencore and Luoyang Molybdenum. In fact, earlier this year, Congo overhauled its regulations, increasing royalties on cobalt, copper and gold and introducing new taxes, a measure that will further increase the costs of mining companies.
"Strategic substances will be defined in a decree issued by the Prime Minister in the next few days, and you will see that the Prime Minister will sign this decree, declaring cobalt and certain other substances to be strategic," Mining Minister Martin Kabwelulu said in the southeast on Saturday. "
As a result of the growing global demand for electric vehicles, the value and importance of cobalt have been soaring in recent years, although copper and nickel mining has become a key component of batteries. In 2017, Congo accounted for 2/3 of global production, or 81000 metric tons.
When the new industry guidelines came into effect in June, royalties for cobalt and copper were raised to 3.5 per cent from the previous 2 per cent. The Act also established the "Strategy" mineral category, with an application rate of 10 per cent.
The worst blow.
After the declaration of cobalt as a strategic resource in the Democratic Republic of the Congo, Glencore and China Moly are likely to be greatly affected. Glencore's Mutanda division is the world's largest metal miner by 2017, producing more than 23000 tons of cobalt., China Moly owns nearly 17000 tons of cobalt mined by Tenke Fungurume Mining, last year.
(the above SMM is translated from Bloomberg News)
According to the latest news, in response to the news that the Democratic Republic of the Congo will declare cobalt a strategic metal and impose a 10% tax on manufacturers, including Glencore and Luoyang Molybdenum Industry, Luoyang Molybdenum Industry Secretary said on the 17th, The country has already raised its tax from 2 per cent to 3.5 per cent, but it faces more complex procedures to raise it to 10 per cent, and the company has not been notified. The current 3.5% tax rate has little impact on companies, even if it is raised to 10%.
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