Cobalt Making Its Move On The Technology Circuit

THE CONFERENCE CALLER: Although talk of lithium dominated the Low Emissions and Technology Minerals Conference in Perth, space opened for its lesser cousin, cobalt to take centre stage.

Addressing the conference’s second day audience, CSA Global director Aaron Green said that the trappings of modern life – iphones, ipads, computers, and the soon to be ubiquitous electric vehicles – were bringing cobalt into the spotlight.

“We live in a revolutionary period as we as a planet strive to reduce our carbon emissions and control pollution levels,” Green said.

“In recent years we have seen incredible interest in technology minerals – firstly graphite, and more recently lithium – now the market has realised that cobalt is one of those commodities that will power the next century.”

Lithium’s place in the battery world was assured when technological types decided to name the power packs lithium-ion batteries.

In recent times nickel has enjoyed a moment of glory thanks to Elon Musk identifying its part in the technology, but cobalt too has of late begun to pull focus.

“The importance of cobalt has led the US government to label it a strategic metal and the EU to include it on their lest of critical metals,” Green said.

Historically, the price, production and costs of cobalt has been linked to copper and nickel markets as the commodity is a by-product of the mining of these more traditional metals.

Globally, just two per cent of cobalt production occurs independent of nickel and copper mining.

Most of this is mined in the Democratic Republic of Congo, which raises strong possibilities of geopolitical risk destabilising global supplies.

Ninety-eight per cent of 2016 global cobalt mine production was derived as a secondary by-product from either nickel or copper mining.

Fifty-four per cent of 2016 global cobalt mine production was derived from copper mining in the DRC.

“Historically, nickel and copper economics have dictated cobalt supply and price,” Green said.

“Cobalt has been produced as a by-product with mine recoveries not attuned to maximise cobalt extraction.”

Between 2010 and 2016, a cobalt supply surplus was created by new nickel and copper projects coming online, resulting in refined production exceeding demand.

This led to a period of depressed cobalt prices, in line with nickel and copper prices, and a slow down in world economies.

“Since mid-to-late 2016 we have seen a significant decoupling of the cobalt price from nickel and copper,’ Green explained.

“This has been due to the emergence of electric vehicles and lithium-ion battery demand.

“The cobalt price more than doubled in this period and has risen by, approximately, seventy per cent since January this year.”

Just as the lithium spokespeople before him, Green emphasised the effect the rising demand of the electric vehicle market has had on the commodity’s rise.

“Electric vehicles have been the major driver of recent cobalt demand,” he said.

“A growing number of major jurisdictions are introducing legislation for minimum numbers of electric vehicles, including China and Europe.

“China is now pushing forward with an aggressive zero emission program, targeting eight per cent by 2018 and twelve per cent by 2020.”