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CMOC Group produced 84,722 tonnes of cobalt in the first nine months of the year, according to the financial report published on Tuesday October 29, up by 127.39% from the same period last year and far above the 60,000-70,000 tonne guidance forecast for 2024.
With cobalt primarily found as a by-product within some copper and nickel mines, a high copper price this year has incentivized copper production and subsequently cobalt production to ramp up.
CMOC produces cobalt from its two copper-cobalt mines located in the Democratic Republic of Congo (DRC).
CMOC produced 476,049 tonnes of copper in the first nine months of the year, up by 78% on the same period last year.
Imports of cobalt intermediates into China over the first nine months of 2024 amounted to 138,848 tonnes (metal content), significantly exceeding the 114,263 tonnes (metal content) imported during the whole of 2023, according to data published by China’s General Administration of Customs.
Processed and mined cobalt production globally is forecast at 265,000 tonnes for 2024, according to Fastmarkets, with this figure likely to be revised with third quarter production reports being released.
“CMOC Group have continued to press ahead in the third quarter with even more aggressive production gains compared to the first half of 2024, with copper prices continuing to incentivize extraction. Talk of supply pressure easing in the second half of this year seems unlikely now with downstream demand for refined cobalt continuing to see headwinds,” Robert Searle, battery raw materials analyst at Fastmarkets, said.
“With copper prices expected to average above $10,000 per tonne next year, the question now is where the excess cobalt will go in 2025 and the effect of all of this will have on cobalt prices,” Searle added.
An oversupply of cobalt has affected the market throughout the last 18 months, with cobalt prices for the benchmark cobalt standard grade price hitting their lowest point since December 2015.
Fastmarkets’ daily price assessment for cobalt, standard grade, in-whs Rotterdam, was $9.80-11.80 per lb on Monday, widening upward from $9.80-11.75 per lb on October 25.
Cobalt hydroxide too has declined to historic lows this year, impacted by the oversupply and demand not able to keep pace.
Fastmarkets’ daily price assessment for cobalt hydroxide 30% Co min, cif China, was $6.10-6.20 per lb on Monday, unchanged since October 23 and at its lowest level since the assessment was launched in February 2019.
In a separate announcement, CMOC has also agreed in principle a supply-and-purchase agreement with Contemporary Amperex Technology Ltd, (CATL) that will run from 2025-2027. CATL are the world’s largest battery-maker and previously held an agreement with CMOC that expires at the end of 2024.
This agreement is for material produced at the Kisanfu mine (KFM) in the DRC, owned by CMOC. In the agreement, CMOC expects the average cobalt annual production capacity at KFM to be at 82,000 tonnes in the two years to December 2026.
A second phase of production capacity expansion at KFM is planned for 2027, with CMOC recently signing a cooperation agreement with Lualaba Power for output from the Nzilo II hydropower station in the DRC.
This agreement, CMOC says, will guarantee long-term and stable power for its new round of capacity leapfrogging at its Tenke Fungurume mine (TFM) and KFM projects. During the third quarter, further exploration work was also undertaken at the TFM site.
Fastmarkets has more than 150 years of specialist commodity expertise. As well as our thousands of metals prices, we have the benchmark cobalt price and a leading cobalt hydroxide price. Keep up to date with cobalt price shifts with access to cobalt price charts, data and expert analysis. Find out more here.