China's CMOC Has Called On Congo To Lift The Cobalt Export Prohibition: Sources

China's CMOC Has Called On Congo To Lift The Cobalt Export Prohibition: Sources

Three sources said that China's CMOC group, the world's largest cobalt mining firm, has asked the Democratic Republic of Congo to end the current export ban for battery metal, which is due to expire next month.

Congo, which is the world's largest cobalt producer, implemented the four-month-long ban in February to try to reduce surpluses after cobalt prices reached a nine-year low of around $10 per lb or $22,000 per metric ton.

Sources said that CMOC Vice President Kenny Ives, during a closed session at an industry conference in Singapore, told delegates that Congo should remove the export restrictions on metals, emphasising how the metal is an important component in batteries for electric vehicles.

Sources who heard Ives speak said that Kizito Pakabomba, the Congo Mines Minister, was present at the session.

The Congo government has not yet made any statement regarding the same, and the market waits for June 22, 2024, when the export ban expires. Sources told the media in February that the government might extend the suspension, and also consider export quotas.

Anonymous sources said that Ives had said China's inventory of pipelines was running low and Congo should allow its miners to export cobalt freely.

Ives said that Congo's restrictions on cobalt exports could accelerate automakers' shift to lithium iron phosphate batteries (LFP), which do not require cobalt.

BYD and other Chinese electric vehicle manufacturers have already adopted LFP battery technology, which is also used in utility-scale energy storage.

Two sources claim that Congolese officials who were present at the event perceived Ives' mention of LFPs as an act of threat. One source said that the remarks reinforced officials' fears that China was trying to lower cobalt prices to build strategic stockpiles.

Officials from the Congo, including Pakabomba, gave no reply to phone calls or emails asking for comments.

CMOC's spokesperson Vincent Zhou made no comment on Ives’ remarks or questions about Congo's fears of stockpiling but stated that the company is in favor of a "healthy marketplace environment."

According to LSEG, Chinese electric vehicle batteries maker CATL has a 30% stake in CMOC.

CMOC is expecting to produce between 100,000 and 112,000 metric tons of cobalt in 2024, which is roughly twice the amount produced in 2023. This will be due to its increased activity at its Tenke Fungurume copper and cobalt mining operations in Congo.