The Democratic Republic of Congo (DRC) has suspended cobalt exports for four months to address oversupply and stabilize prices, according toBloomberg.The DRC, which produces about 75% of the world’s cobalt used in electric vehicle (EV) batteries, saw a surge in production due to increased output from China’s CMOC Group Ltd. This led to a supply glut, causing prices to plummet to a 21-year low, with cobalt hydroxide dropping below $6 a pound.
Patrick Luabeya, president of ARECOMS, the regulatory authority, stated that exports must align with global demand. The suspension, effective February 22, follows a government decree allowing temporary measures to stabilize the market. While cobalt demand continues to rise, it has been outpaced by supply, exacerbated by the growing use of cobalt-free EV batteries. Analysts predict the surplus will persist until the end of the decade.
The DRC, also the world’s second-largest copper producer, has been monitoring market dynamics for a year. Luabeya emphasized that illegal mining and uncontrolled exports have created excessive supply, threatening the country and its investors. The export ban applies to all cobalt producers but does not affect copper exports, as the two metals are marketed separately.
CMOC, now the largest cobalt producer, surpassed Glencore in 2023, accounting for over 40% of global supply. Eurasian Resources Group is currently the third-largest produce.
