RE: Why cobalt?15 Mar 2018 09:54
About 10 kilogrammes of cobalt is used in an electric car battery � more than 1,000 times the amount used in an iPhone � according to BMO Capital Markets.
The price of the metal has more than doubled over the past two years as carmakers scramble to secure supply to meet their ambitious plans for electric cars. Volkswagen said this week it had awarded �20bn worth of contracts to secure battery supplies.
More than 60 per cent of globally produced raw cobalt ore comes from the Democratic Republic of Congo. Glencore is the largest producer, followed by China Molybdenum, which bought the Tenke Fungurume mine for $2.65bn in 2016.
Pricing for the deal with GEM was not disclosed. Ivan Glasenberg, Glencore�s chief executive, has said that the miner would not sign fixed price deals for cobalt supply with any company.
�With the rapid growth of global new energy car production . . . cobalt has become a global resource in short supply,� GEM said.
To meet rapidly growing demand from carmakers, Glencore is increasing its output from the DRC from 39,000 tonnes this year to 65,000 tonnes in 2019 and then reducing slightly to 63,000 tonnes in 2020.
Under terms of the deal, GEM said it would get 13,800 tonnes this year, 18,000 tonnes in 2019 and 21,000 in 2020.
The $4.6bn company, which is China�s largest recycler of batteries, said supply of recycled metal could no longer meet its needs.
�The company�s need for cobalt is increasing daily, and the company�s recycled cobalt resources cannot satisfy our strategic demand,� GEM said.
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