DRC Cobalt Export Ban Reshapes China’s Import Landscape in 2025

ByJohn Zadehon August 20, 2025

Understanding the DRC Cobalt Export Ban

The Democratic Republic of Congo (DRC) has implemented significant restrictions on cobalt exports that continue to reshape global supply chains. First implemented in February 2025 and extended for another three months on June 21, these restrictions mark a pivotal shift in how the world's largest cobalt producer manages its critical minerals strategy.

The ban represents a strategic move by the DRC government to increase domestic value addition to its mineral wealth. By restricting exports of unprocessed and semi-processed cobalt materials, the DRC aims to encourage more in-country processing facilities, creating jobs and capturing more value from its natural resources.

July 2025 marked the fifth month of these export restrictions, providing sufficient time to observe measurable impacts on global markets, particularly for China as the world's largest cobalt consumer and processor.

Strategic Motivations Behind the Ban

The DRC's export controls reflect a growing trend among resource-rich nations to move beyond being mere suppliers of raw materials. The country holds approximately 70% of global cobalt reserves, giving it significant leverage in the battery metals market.

By implementing these restrictions, the DRC government aims to:

• Encourage investment in local processing facilities
• Create higher-skilled employment opportunities
• Capture more value from its mineral resources
• Strengthen regulatory oversight of mineral exports
• Improve traceability in the supply chain
• Increase tax revenue from higher-value exports

Scope of the Restrictions

The restrictions primarily target cobalt intermediates such as hydroxide rather than fully processed cobalt products. Companies that can demonstrate investments in local processing capacity may receive exemptions, creating a tiered system that favors those contributing to the DRC's industrial development.

The implementation has been gradual yet firm, with increasing enforcement at border checkpoints and verification of export documentation. This has created a complex compliance environment for mining companies operating in the country.

What Impact Has the Ban Had on China's Cobalt Intermediate Imports?

China, as the world's largest processor of cobalt, has experienced significant disruption to its supply chains since the implementation of the DRC cobalt export ban and China's imports have been notably affected. The latest import figures reveal the continuing impact of these restrictions on the world's largest cobalt consumer.

July 2025 Import Statistics

According to data from China's General Administration of Customs, China imported just 4,143 tonnes (metal content) of cobalt intermediates in July 2025. This represents a substantial:

• 27.28% decrease from June's 5,697 tonnes
• 72.27% year-over-year decline from July 2024's 14,941 tonnes

This continuing downward trend highlights the material impact of the DRC's policy on global cobalt supply chains, with each passing month showing further tightening of available material.

"China's July import volume of cobalt intermediates still shows a decline due to the continuous cobalt export ban from the DRC, indicating that the availability of material in the market is gradually tightening. Currently, various low-priced cobalt products are also becoming increasingly scarce," noted a cobalt trader familiar with the market.

Market Expectations vs. Reality

While the decline is significant, it fell short of the more dramatic drop many market participants had anticipated. "Before the data came out, most of us were expecting a drop of over 50%," explained one cobalt trader. "The fact that it was less suggests there's still material available outside the DRC under the ongoing cobalt export restrictions."

Several factors appear to be moderating the immediate impact:

1. Bonded zone inventories – Material stockpiled before the ban continues to enter the Chinese market
2. Long-term contracts – Some miners are still fulfilling pre-existing agreements despite restrictions
3. Non-DRC sourcing – Material from alternative origins helping to partially offset the supply gap
4. Strategic reserves – Release of previously stockpiled material by major consumers

A cobalt hydroxide consumer commented, "The export figures are a little disappointing, higher than we expected. It shows there are still inventories, maybe in the bonded zone. We've heard some miners are still fulfilling long-term delivery contracts for hydroxide, so there's still some material flowing, despite cobalt export restrictions."

Progressive Decline Pattern

The July figures represent the continuation of a downward trend that began with the initial ban implementation in February. Each month has shown further tightening in the supply chain, though the rate of decline has been more gradual than initially expected.

This gradual decline rather than immediate collapse suggests sophisticated supply chain management by major Chinese processors, who likely prepared for the restrictions by building inventory buffers and developing alternative sourcing strategies.

How Are Cobalt Prices Responding to Supply Constraints?

The tightening supply situation is beginning to manifest in cobalt pricing, particularly for the hydroxide form that serves as a key intermediate feedstock for processors.

Cobalt Hydroxide Price Movements

According to Fastmarkets' daily price assessment, cobalt hydroxide 30% Co min, cif China was priced at $13.10-13.30 per lb on August 20, 2025. This represents a significant increase from $11.75-12.20 per lb recorded on June 20, just prior to the DRC announcing the extension of the ban.

This price appreciation of approximately 12% over a two-month period directly correlates with the continuing supply constraints created by the export restrictions.

Price volatility has increased as the market adjusts to new supply realities. Days with price movements exceeding 3% have become more common, reflecting heightened sensitivity to supply news and trade data.

Supply-Demand Dynamics

The price movement reflects fundamental market dynamics responding to:

• Tightening intermediate feedstock – Reduced availability of hydroxide for processing
• Diminishing low-priced inventory – Depletion of material stockpiled before the ban
• Strategic buying – Processors securing material to maintain production continuity
• Market sentiment – Growing concerns about sustained supply constraints

The relationship between import volumes and price movements shows a clear inverse correlation, with prices rising as import volumes decline. This pattern suggests market pricing is functioning efficiently to signal scarcity and incentivize both conservation and new supply development.

What's Happening with China's Cobalt Metal Exports?

Despite the challenges in securing raw material inputs, China's cobalt metal exports have shown remarkable resilience, highlighting the strategic importance of maintaining export relationships even amid domestic supply constraints.

Export Volume Stability Despite Import Disruptions

China exported 978 tonnes of cobalt metal in July 2025, according to customs data. This represents:

• 5% increase from 930 tonnes in June 2025
• 50% year-over-year increase from 654 tonnes in July 2024

This continued export strength despite import challenges suggests Chinese processors are prioritizing finished product exports over raw material stockpiling, potentially to maintain cash flow and preserve market relationships during this period of supply uncertainty.

Key Export Destinations

The Netherlands maintained its position as China's primary cobalt metal export destination, receiving 629 tonnes in July 2025. This represents a 7.7% increase from the 584 tonnes shipped in June.

Other significant destinations include:

• United States
• South Korea
• Japan
• Germany

These export patterns reflect the global nature of the battery supply chain and the strategic importance of maintaining material flow to key manufacturing hubs despite the upstream supply challenges.

Factors Maintaining Export Stability

Several market conditions help explain the relative stability in export volumes:

"Exports are still happening, but at a relatively stable level. European inventories remain high, and with weak demand during the summer period, prices lack upward momentum," explained a Chinese trader.

The market dynamics supporting export stability include:

1. High inventory levels in destination markets – European warehouses still hold significant material
2. Seasonal demand patterns – Summer traditionally sees reduced industrial activity
3. Strategic relationship maintenance – Processors prioritizing key customers despite supply challenges
4. Value-added focus – Concentrating on higher-margin finished products rather than intermediates

These factors combine to create a situation where "limited change in July exports reflects poor overseas buying interest amid low margins and high inventory levels in Europe," according to market participants.

Broader Market Implications

The DRC cobalt export ban has triggered a cascade of adaptations across the global supply chain, with implications reaching far beyond immediate price movements.

Supply Chain Adaptations

Market participants are implementing various strategies to navigate the new supply landscape:

1. Alternative sourcing initiatives

• Increased interest in cobalt expansion projects
• Exploration of cobalt-bearing deposits in more politically stable jurisdictions
• Development of processing capacity outside traditional hubs

2. Inventory management evolution

• Shift from just-in-time to strategic buffer approaches
• More sophisticated forecasting and supply risk modeling
• Vertical integration attempts to secure supply chains

3. Recycling acceleration

• Enhanced investment in cobalt recovery from batteries and electronic waste
• Improved technology for efficient metal extraction from secondary sources
• Integration of recycled content into battery manufacturing processes

These adaptations reflect the market's natural response to supply constraints, with innovation often emerging from necessity.

Future Supply Outlook

The market continues to adapt to the reality that restrictions may become a long-term feature of the cobalt landscape. Key considerations include:

Potential ban extension scenarios:

• Full extension beyond the current three-month period
• Modified restrictions with conditional exemptions
• Graduated system based on value-addition commitments

Market preparation strategies:

• Downstream consumers building longer inventory positions
• Development of alternative battery chemistries with lower cobalt content
• Strategic alliances between processors and end-users to secure supply

"The unexpectedly high import volume reinforces the view that there is no immediate supply shortage in the domestic market, regardless of strict cobalt export conditions," noted one market analyst.

A cobalt hydroxide consumer added: "There's no urgency to procure. The downstream smelters aren't buying or producing actively, and with imports still showing available material, the market is likely to remain flat in the near term."

This relative calm despite the ongoing restrictions suggests the market has already begun to adapt to the new normal of constrained DRC exports.

FAQ: DRC Cobalt Export Ban and China's Imports

Why did the DRC implement a cobalt export ban?

The Democratic Republic of Congo implemented export restrictions primarily to increase domestic value addition to its mineral resources. By restricting exports of unprocessed and semi-processed materials, the DRC aims to encourage investment in local processing facilities, create higher-skilled jobs, capture more of the value chain, and strengthen its position in global cobalt markets. The policy aligns with broader resource nationalism trends seen across mineral-rich nations seeking to maximize the benefits from their natural resources.

How long is the current ban expected to last?

The current extension announced on June 21, 2025, is set for three months. However, many market participants are preparing for potential further extensions, as the policy appears aligned with the DRC's long-term industrial development goals rather than being a temporary measure. The eventual duration will likely depend on progress toward establishing more domestic processing capacity and the government's assessment of the policy's effectiveness in achieving its strategic objectives.

Are all cobalt products from DRC banned from export?

The restrictions primarily target cobalt intermediates like hydroxide rather than fully processed cobalt products. Companies with investments in local processing capacity may receive exemptions, creating a tiered system that incentivizes domestic value addition. The ban is structured to encourage upgrading along the value chain rather than completely halting exports, with refined cobalt products facing fewer restrictions than raw or semi-processed materials.

How are battery manufacturers responding to these supply disruptions?

Battery manufacturers are implementing multi-faceted strategies including:

• Diversifying supply sources beyond the DRC
• Increasing inventory buffers where financially feasible
• Accelerating recycling initiatives to recover cobalt from end-of-life batteries
• Exploring alternative battery chemistries with reduced cobalt dependency
• Forming strategic partnerships with miners and processors to secure supply
• Investing in technology to improve material efficiency in battery production

Many are also closely monitoring policy developments in the DRC to anticipate potential adjustments to the restrictions.

Will cobalt prices continue to rise due to the export ban?

While supply constraints typically support higher prices, several factors may moderate future increases:

1. Existing inventories continue to buffer immediate impact
2. Demand uncertainty in key sectors like electric vehicles and electronics
3. Development of alternative sources outside the DRC
4. Technological advances reducing cobalt intensity in batteries
5. Macroeconomic factors affecting overall commodity demand

Price trajectory will depend on the ban's duration, effectiveness of alternative supply development, and downstream demand strength. The relatively modest price increases seen thus far suggest the market had partially anticipated these restrictions and prepared accordingly.

The current situation highlights the complex interplay between resource nationalism and global supply chains in the context of energy transition and security concerns. As mining industry evolution continues, the battery metals investment landscape is likely to remain dynamic in response to these policy-driven supply shifts.

Source: https://discoveryalert.com.au/news/drc-cobalt-export-ban-2025-impact-china-imports/