Cobalt

Market Overview – Cobalt

Cobalt is an industrially and strategically extremely important metal, widely used in electric vehicle (EV) batteries, aerospace, high-strength alloys, and electronics. The importance of cobalt has increased with the rise in lithium-ion battery production, making it one of the most demanded and speculative commodities in the global market.

Cobalt Price and Mining Volumes over the Last 50 Years (1974–2024)

Price Development
• 1970–1990: The main use of cobalt was in the steel industry and superalloys. Prices were relatively low, ranging from 5,000–8,000 USD per ton (5–8 USD/kg).
• 1990–2005: The expansion of the electronics industry increased demand, but production was able to keep pace. Prices fluctuated between 10,000–15,000 USD per ton (10–15 USD/kg).
• 2005–2010: The rapid growth of China’s electronics industry and developments in the battery sector raised the price to 25,000 USD per ton (25 USD/kg).
• 2010–2020: The development of electric vehicles increased cobalt demand, pushing the price to 80,000 USD per ton (80 USD/kg), but the market later declined due to higher production, ranging from 30,000–40,000 USD per ton (30–40 USD/kg).

Mining Volumes
• In the 1970s, global cobalt production was about 10,000 tons per year.
• In the 2000s, production rose to 40,000 tons per year.
• In the 2010s, production rose to 120,000 tons per year.
• In the 2020s, global cobalt production reached 160,000 tons per year, with over 70% of cobalt mined in the Democratic Republic of the Congo.

Cobalt Price and Mining Volumes over the Last 10 Years (2014–2024)

Price Development
• 2014–2016: Cobalt prices remained stable at 30,000 USD per ton (30 USD/kg).
• 2017–2018: The rapid growth of the electric vehicle market and speculation pushed cobalt prices to a peak of 95,000 USD per ton (95 USD/kg).
• 2019–2020: New mines came online, especially in the DRC, causing prices to drop to 32,000 USD per ton (32 USD/kg).
• 2021–2022: The sharp increase in electric vehicle sales restored prices to 80,000 USD per ton (80 USD/kg).
• 2023–2024: Cobalt prices fell to 40,000–50,000 USD per ton (40–50 USD/kg) as mining in the DRC continued at large scale.

Mining Volumes
• 2014: 90,000 tons per year.
• 2018: 140,000 tons per year.
• 2022: 160,000 tons per year.
• 2023–2024: Over 170,000 tons per year, with major producers:
Democratic Republic of the Congo (70%)
Russia (4%)
Australia (4%)
Canada (3%)

Cobalt Price Forecast for the Next 10 Years (2025–2035)

Price Forecast
• 2025–2030: Prices will stabilize between 45,000–60,000 USD per ton (45–60 USD/kg) as supply chains adapt to demand.
• 2030–2035: If demand for electric vehicles and energy storage systems continues to grow, cobalt prices may rise above 75,000 USD per ton (75 USD/kg).

Mining Forecast
• 2025: Global production may reach 200,000 tons per year.
• 2030: Production is forecasted to be 250,000 tons per year.
• 2035: If alternative technologies do not replace cobalt, production could reach 300,000 tons per year.

Inflation and Consumption Impact on Cobalt Prices

Impact of Inflation
• Inflation raises mining costs due to increases in labor, electricity, and fuel prices.
• Currency fluctuations affect DRC exports as the operational costs of cobalt mines are linked to the dollar’s value.
• The industry’s need to secure long-term supply contracts may cause price fluctuations.

Impact of Increased Consumption
• Electric Vehicles: Cobalt is a critical component of lithium-ion batteries in electric vehicles. By 2030, electric vehicle sales may account for 60% of new cars, increasing demand.
• Aerospace and Defense: Cobalt alloys are essential in aircraft engines and jet propulsion systems.
• Electronics: Smartphones, tablets, and laptops rely on cobalt-based batteries.

Cobalt Applications

1. Electric Vehicle Batteries (EVs) (55%)
   • Nickel-Manganese-Cobalt (NMC) and Nickel-Cobalt-Aluminum (NCA) batteries.
   • Tesla, BMW, Volkswagen, and other automakers rely on cobalt supplies.
2. Aerospace and Defense (20%)
   • Superalloys: Cobalt enhances heat resistance and strength, used in aircraft turbines.
3. Electronics (10%)
   • Smartphones, laptops, and tablets use cobalt-based lithium-ion batteries.
4. Medicine (5%)
   • Radiation Therapy: Cobalt-60 isotope is used in cancer treatment.
   • Orthopedic Implants: Medical alloys contain cobalt.
5. Industry and Chemicals (10%)
   • Catalysts in petroleum refining.
   • Pigments and dyes in ceramics and glass industries.

Conclusion
Cobalt is a vital metal that directly impacts the development of electric vehicles, high technology, and aerospace. Over the past decade, its price has been volatile, reflecting fluctuations in the electric vehicle market and geopolitical factors.

Over the next decade, cobalt production is expected to grow significantly, but alternative technologies (such as solid-state batteries and lithium iron phosphate batteries) may reduce dependency on cobalt. If cobalt remains in electric vehicle production, its price could rise again to record levels.

Mining companies with access to high-quality cobalt deposits and who can ensure ethical and sustainable production will be the big winners in the future.

(Note: This is an opinion and should not be treated as a statement of fact.)