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Costs of EV battery material cobalt hydroxide jump on Congo export restrictions
Prices of cobalt hydroxide used to make chemicals for electric vehicle batteries have risen sharply this year due to cobalt export restrictions from top producer Democratic Republic of Congo, industry sources said.
Congo suspended all cobalt exports in February, but then introduced a quota system in October, aiming to boost state revenues and tighten oversight in a country that produces more than 70% of the metal globally, estimated at more than 280,000 metric tons this year.
It has set new conditions for exporters, potentially complicating the recently introduced quota system, which sources say is likely to exacerbate shortages and support cobalt hydroxide prices.
“Cobalt is currently registering as 2025’s top price performer, but this has purely been driven by the introduction of export quotas by Congo which have caused an artificial market tightness, removing 160,000 to 170,000 tons from the market this year,” analysts at Macquarie said in a recent note.
Cobalt hydroxide is produced in Congo and as a by-product of copper and nickel mining in Indonesia, the two primary global producers. The products are priced as a percentage of the underlying cobalt metal price and known as payables.
Sellers of cobalt hydroxide have been raising their prices since Congo first suspended exports in February.
Payables for Congo’s hydroxide in top consumer China have jumped to 100% of the cobalt metal price currently trading around $24 a lb or $52,900 a ton, up from nine-year lows of around $10 a lb in February.
One source said there is some progress on getting exports moving, but that the significant amounts needed by China’s electric vehicle battery makers would not arrive until February or March next year.
Two industry sources said some firms with cobalt hydroxide to sell were asking for a premium above the cobalt metal price.
For hydroxide produced in Indonesia, payables have jumped to 90% from 50% at the start of the year.
Three industry sources, who asked not to be named as they are not authorized to speak to media, said demand for cobalt hydroxide slowed this month and that high payables are sidelining buyers.
(By Dylan Duan and Pratima Desai)
Congo sets new export conditions to keep tight grip on cobalt
Congo has set new conditions for cobalt exporters, according to a government circular reviewed by Reuters, potentially complicating a recently introduced quota system as the country seeks to keep a tight grip on the key battery mineral.
The new conditions require miners, among other things, to pre-pay a 10% royalty within 48 hours and secure a compliance certificate, the circular shows.
The Democratic Republic of Congo replaced a months-long export ban with a quota system in October, aiming to boost state revenues and tighten oversight in a country that produces more than 70% of the world’s cobalt, a key component in electric vehicle batteries.
No shipments have moved since the ban was lifted as producers seek clarity and work to meet compliance rules, Reuters has previously reported.
The joint circular from the mines and finance ministries, dated November 26, sets out procedures for exporters, including mandatory quota verification, joint sampling, weighing and sealing of lots, and issuance of a new Quota Verification Certificate (AVQ) by the Authority for the Regulation and Control of Strategic Mineral Substances’ Markets (ARECOMS).
The AVQ must accompany export documentation alongside a checklist of certificates from multiple agencies. The rules took effect immediately.
Exporters must also pre-pay a 10% mining royalty on allocated quotas within 48 hours of filing origin and sales declarations, and obtain a “liberatory receipt” before customs clearance.
All mineral shipments will undergo physical inspections and be subject to multi-agency oversight, the circular states.
The mines and finance ministries did not immediately respond to requests for comment, nor did Congo’s mines chamber.
Cobalt exporters facing uncertainty
Congo allocated 18,125 metric tons of export quotas for the fourth quarter of 2025 and plans 96,600 tons annually from 2026. Top producers China’s CMOC and Glencore received the largest quotas, while ARECOMS retained a 10% strategic reserve.
Congo has warned that non-compliance could lead to severe penalties, including licence revocation.
A mining executive, who declined to be named due to the sensitivity of the matter, said there was considerable uncertainty around the new conditions.
“Companies want to understand whether the 10% royalty to be paid for export will take into account the amount from the last export (before the ban),” the executive said.
Panmure Liberum analyst Duncan Hay said: “Congo’s shifting export rules offer no certainty — last-minute royalty demands and complex paperwork will keep exports and prices volatile.”
Cobalt is currently trading around $24 a lb or $52,910 a ton, compared with $16 a lb or $35,275 a ton in August. Prices have been climbing since hitting a nine-year low around $10 a lb in February when the export ban was introduced.
Further supply insecurity could erode battery demand, said Hay.
Congo, also a major copper supplier, is pushing reforms to gain more control over its vast mining output. It launched its first batch of traceable artisanal cobalt last month and signed a partnership with Swiss commodity trader Mercuria to market cobalt, copper and other critical minerals.
(By Ange Kasongo in Kinshasha and Maxwell Akalaare Adombila; Editing by Mark Potter)
Nornickel fully restores cobalt production after repairs from 2022 fire
Credit: NornickelRussian mining and metals giant Norilsk Nickel has fully completed the reconstruction of its cobalt production facility in the Murmansk region, which was damaged in a fire three years ago, the company said on Monday.
The upgraded facility will increase metal production.
Norilsk Nickel is the only cobalt producer in Russia. Before the September 2022 fire at the facility, the plant’s capacity was 2,500 metric tons per year. After the fire, the company restored part of the facility, producing 1,000 tons a year in concentrate or pure form.
After the reconstruction, the plant’s annual capacity will reach up to 3,000 tons of metallic cobalt, Norilsk Nickel said.
(By Anastasia Lyrchikova and Felix Light; Editing by Tom Hogue)
Russian mining and metals giant Norilsk Nickel has fully completed the reconstruction of its cobalt production facility in the Murmansk region, which was damaged in a fire three years ago, the company said on Monday.
The upgraded facility will increase metal production.
Norilsk Nickel is the only cobalt producer in Russia. Before the September 2022 fire at the facility, the plant’s capacity was 2,500 metric tons per year. After the fire, the company restored part of the facility, producing 1,000 tons a year in concentrate or pure form.
After the reconstruction, the plant’s annual capacity will reach up to 3,000 tons of metallic cobalt, Norilsk Nickel said.
(By Anastasia Lyrchikova and Felix Light; Editing by Tom Hogue)
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