According to a specialist trading firm, Darton Commodities has reported a significant increase in cobalt supply in 2022.
The surge in supply has been driven by booming production in the Democratic Republic of Congo (DRC) and Indonesia, leading to a 23% rise to 187,060 tonnes, which erased the deficit seen in 2021.
The DRC, responsible for 75% of global supply, produced more than 111,000 tonnes of cobalt in 2022, while Indonesia is emerging as a significant player in the small but rapidly growing market.
However, this supply surge has coincided with a sharp slowdown in demand from the electronics sector, which competes with the electric vehicle industry as the biggest consumer of battery metal. Consequently, cobalt prices have fallen over 60% from their June peak.
Despite this, global mining production is estimated to have increased by 42% between 2020 and 2022 due to the easing of supply chain constraints related to Covid-19, the ramping up of existing operations, and the commissioning of new mines.
Glencore Plc remains the world’s largest mineral miner, with significant operations in the DRC. Eurasian Resources Group and China’s CMOC Group Ltd., which also have significant operations in Congo, followed the Swiss company as the biggest producers in 2022.
Chinese companies own or control 44% of the world’s mining supply and account for 78% of refined cobalt output, according to Darton estimates.
The UK-based trading house predicts that mining output will increase by around another third over the next two years.
