Glencore recently stated in its earnings guidance that due to the cobalt export ban imposed by the Democratic Republic of Congo (DRC), a significant portion of its cobalt production from that country may be unsellable until the end of 2025. While the company acknowledges that this will cause substantial shipment disruptions, it also emphasizes that the overall financial impact for the year is expected to be “limited.” This assessment reveals two key points: first, Glencore believes the market is currently in an oversupply phase, and the export suspension can effectively ease this pressure; second, the company expects such intervention to accelerate inventory reduction and subsequently support a price rebound, which will be beneficial for future sales.
Based on this outlook, Glencore has not made any significant production cuts; instead, it has raised its full-year cobalt production forecast to 42,000 to 45,000 tons, up noticeably from 38,200 tons in 2024. This indicates that the company does not view the export restrictions as a long-term threat to its profitability but rather as a phase of supply adjustment. In other words, Glencore does not see the export limitations as a business crisis but as an opportunity that might lead to price recovery and value realization in the future.
Starting from Glencore’s position, we can infer three potential impacts on the overall cobalt market.
First, the supply-demand balance may tighten temporarily. The DRC accounts for more than 70% of global cobalt supply, and Glencore is one of the largest producers there. If its exports are systematically hindered, the global spot cobalt market will lose a major source of circulation in the short term. Although overall cobalt demand growth has slowed, especially with the rise of lithium iron phosphate (LFP) batteries, which reduce reliance on cobalt, high-energy-density ternary batteries, aerospace power batteries, and certain military applications still depend heavily on cobalt as a key material. Once inventories begin to clear faster, the spot market is likely to experience upward price pressure.
Second, the logic supporting price increases is strengthened. Glencore’s judgment is based on the premise that the market is not short of cobalt resources, but rather lacks orderly and controlled supply flows. The export restrictions temporarily pull cobalt out of an oversupplied "imbalanced" state, turning it into a resource released in a controlled manner. In other words, this creates an artificial sense of scarcity, providing room for cobalt prices to recover. If the restrictions continue until the end of this year, it is possible that cobalt prices will see a rebound in early 2026.
Third, market structural differentiation may intensify. Large companies like Glencore can hedge the impact of export policies through global operations, inventory management, and financing capabilities, but small and medium-sized cobalt producers or processors may lack such buffers. For downstream manufacturers, this will encourage prioritizing long-term contracts with leading enterprises that have guaranteed capacity and supply capabilities, thereby increasing market concentration.
Therefore, based on Glencore’s outlook, we see the cobalt market entering a phase dominated by policy regulation, gradual price recovery, and a rebalancing of supply and demand. This shift may not immediately show in spot transactions, but its influence is gradually reflected in corporate decisions and market sentiment. Cobalt will not quickly become a scarce metal, but it will no longer be undervalued. Glencore’s strategy appears to be “stabilize first, then wait for the market to clear,” a mindset likely being adopted by more upstream resource companies, marking the start of a new adjustment cycle for the cobalt industry.
