DRC restarts cobalt exports as Russia triples output

Global critical metals markets could see more cobalt enter their supply chains in the coming weeks as the Democratic Republic of Congo (DRC) resumes exports this week and Russia triples production at a re-started plant.

The world’s top producer of cobalt, accounting for three-quarters of global output, the DRC, is due to resume exports of the critical metal this week but under new rules. And Russia’s Nornickel cobalt production plant in Siberia is preparing to churn out 3,000 tonnes a year.

New regulations call for miners to pre-pay a 10% royalty within 48 hours and obtain a compliance certificate, Reuters reported, citing documents from the DRC’s mines and finance ministries. The procedures also include joint sampling, weighing and sealing of lots and a new Quota Verification Certificate from the Authority for the Regulation and Control of Strategic Mineral Substances’ Markets.

The new rules could complicate efforts to resume exports and snarl supply chains, BMO Capital Markets said in a note on Tuesday.

The global cobalt market is estimated to be worth about $16.9 billion this year and is expected to grow to $30.5 billion by 2033, according to data from SNS Insider.  Cobalt sulphate, used in lithium-ion batteries held the largest market share at 46% this year, while cobalt hydroxide, oxide and salts – used in alloys, ceramics and catalysts – made up the remainder.

Suspension lifted

The new conditions come after the country also this week lifted its 10-month suspension on cobalt exports, set in February to help lift prices of the metal which had dropped to a nine-year low. The ban was modified in September to become an annual shipment quota where miners could ship up to 18,000 tonnes for the rest of this year and a maximum of about 96,600 tonnes in 2026 and 2027.

However, the DRC’s mining lobby has sought immediate talks with the government to clarify the new cobalt export rules, Reuters reported. Legal ambiguities and compliance issues could delay shipments and disrupt supply chains, the lobby has said.

Cobalt traded for $24 per lb. on Tuesday, down 40% from the metal’s recent peak in 2022 of $39.75 per pound.

Russia restarts after fire

Meanwhile, reconstruction at Russia’s Nornickel plant is complete after a fire in 2022 cut output, the country’s Interfax news agency reported.

Monchegorsk (Kola Mining and Metallurgical Complex), the only producer of high-grade electrolytic cobalt in Russia, now has an annual capacity of 3,000 tonnes at a 99.9% purity rate, compared with 1,000 tonnes after the fire. Before the fire, capacity was around 2,500 tonnes per year.

After the DRC, which produces 76% of global output, Indonesia is the world’s second largest cobalt producer, with a 12% market share and Russia is third, producing about 2% of global supply, according to the Cobalt Institute.