According to foreign media reports, Glencore (Glencore Plc) plans to restart its copper and cobalt project in Mutanda Mining, Congo, by the end of this year, which has been idle for about two years.
Congo's new mining minister, Karabai (Antoinette N'samba Kalambayi), met with representatives of Glencore on Monday local time to discuss the resumption of the Mutanda mine, which was closed in November 2019, the Congolese Ministry of Mines said in a statement.
Glencore said in an emailed statement that Mutanda "will start production by the end of this year in order to resume production in 2022".
The Mutanda mine is the world's largest copper-cobalt mine and one of Glencore's important assets in Congo. According to (Darton Commodities Ltd.) of Darden Commodities Co., Ltd., a British company specializing in cobalt production Mutanda accounted for 1/5 of global cobalt production in 2018, it said.
Cobalt prices fell more than 40 per cent that year as a result of a surge in cobalt supply in Congo in 2019. After the sharp fall in cobalt prices, Glencore announced that it would suspend production at the Mutanda mine in November of that year because the mine was "no longer economically viable".
Automobile electrification increases Cobalt Market demand
Demand for battery metals has surged in the past two years as carmakers focus on metal-intensive electric vehicles and the global economy shifts from fossil fuels to electricity-based clean energy technologies. Cobalt and copper are the key metals needed for this transition.
David Brockas (David Brocas), a cobalt trader at Glencore, last month quoted Jeffery (Jefferies), an investment bank, as saying that the current cobalt market of 120000 to 130000 tonnes a year is expected to double by 2025, with about half of global demand coming from batteries.
Brocas explained that consumer electronics (such as tablets and mobile phones) and electric car (EV) currently have a similar demand for cobalt in the battery market-each accounting for about 25 per cent of the total demand, while the price elasticity of cobalt demand for electronics is relatively small, in part because the cost of cobalt is relatively low relative to the total cost of electronic products.
Other end markets for cobalt include superalloys (mainly in aerospace), magnets, chemical catalysts, hard metals and pigments, Brocas added.
However, the main demand growth is "clearly in the field of electric vehicles", as Brocas believes that while battery technology that does not use cobalt will also have a place in the market, cobalt batteries are essential for policy-driven decarbonization or electrification programmes.
Brocas said Glencore expects to produce 35000 tonnes of cobalt in 2020 and is expected to add about 20, 000 tonnes of cobalt to the market each year with the restart of the Mutanda mine, but Brocas said Glencore would be careful to increase production "to avoid oversupply in the market".
