The Democratic Republic of Congo (DRC), a major global supplier accounting for 70% of cobalt production, grapples with the drastic decline in cobalt prices.
Nicolas Kazadi, the DRC’s Finance Minister, highlighted the dramatic fall from $81,000 to $31,000 per tonne in a year, expressing concerns over this staggering drop.
As of November 23, 2023, the price of copper surged by 2.27% to reach $8,306.35 per tonne. In contrast, cobalt prices experienced a slight decline of 0.03%, totaling $32,737.31 per tonne, as reported by the Central Bank of Congo (BCC).
Minister Kazadi emphasized the DRC’s struggle to exert influence over the cobalt market, despite its dominant position in supply.
He underlined the need for better organization within the cobalt market and lamented the imbalance, stating that the value addition in cobalt primarily benefits those processing it rather than the local producers.
The minister pointed out the discrepancy in cobalt transactions, with buyers in the DRC also being the ones transforming the mineral outside the country.
This situation perpetuates a cycle where low purchase prices are set locally, leading to significant profits during processing and subsequent sale at competitive international prices, leaving local value unrealized.
Advocating for local processing of cobalt, Minister Kazadi urged the transformation of the mineral within the country to ensure that the added value benefits the DRC.
He highlighted the government’s commitment to regulating the cobalt sector, drawing a parallel with the Organization of the Petroleum Exporting Countries (OPEC) that influences oil prices despite a minority share in production. Reforms are underway to better structure and oversee the cobalt industry in the DRC.
Major mining entities operating in cobalt extraction and production in the DRC include Glencore, situated in the southeastern region, along with China Molybdenum (CMOC), ERG (Eurasian Resources Group), Huayou Cobalt, and Gécamines.
This situation underscores the challenges faced by the DRC in maximizing the value of its mineral resources and asserting control over international cobalt market prices.
Comment voulez-vous influencer le prix du cobalt si vous n’avez aucun controle sur les mines qui le produisent? La participation de la RDC dans les capitaux des co-entreprises est trop petite. La RDC a choisi de sous-traiter la production du cobalt par les entreprises etrangeres. Elle a perdu son independence economique et subira ce que lui imposeront les autres. Il faut reprendre le controle de ses mines et la chaine de valeur de ses produits miniers.