The Cobalt Institute’s Cobalt Market Report 2021, ready by CRU, confirms the function of cobalt as one the important thing commodities of the inexperienced future, because of the fast development of the lithium-ion battery market and a powerful world uptake of electrical automobiles.
In 2021, the cobalt market confirmed unprecedented demand development of twenty-two% year-on-year (y/y) to 175 kt. Demand rose by 32 kt in 2021 alone in comparison with 51 kt within the 5 years from 2015-20. Progress was led by lithium-ion battery functions, accounting for 63% of annual demand and 85% of y/y development.
In 2021, cobalt demand from electrical automobiles overtook different battery functions for the primary time to grow to be the biggest finish use sector at 34% of demand. It’s anticipated to account for half of the cobalt demand by 2026.
In 2021, cobalt-containing battery chemistries accounted for 3 quarters (74%) of the worldwide electrical automobiles battery market.
Provide additionally returned to development in 2021, with mine provide rising 12% y/y to 160 kt, after falling in 2020.
The Democratic Republic of the Congo remained the biggest supply of cobalt provide, accounting for 74% of the worldwide mine provide and 87% (15 kt) of annual development.Output from the artisanal and small scale mining (ASM) sector is estimated to have elevated to 14.5 kt in 2021, 12% of the DRC’s whole provide.
Main refined provide elevated 14% y/y to 144 kt. China remained the biggest refiner of cobalt globally (72% of whole main manufacturing). Indonesia is the biggest development marketplace for refined cobalt manufacturing after China, and is predicted to offer 1 / 4 of whole refined cobalt development within the medium time period.
European steel costs doubled by way of the 12 months from $16/lb in January to $32/lb by the tip of the 12 months. Attributable to relative market weak spot, European costs averaged $2.5 under Chinese language steel in 2021, with the low cost persisting since mid-2020. Cobalt sulfate costs additionally maintained a premium over steel, averaging $3.6/lb, because of very sturdy chemical demand development from the lithium-ion battery sector.
Cobalt demand is predicted to proceed rising quickly because the EV transition beneficial properties tempo. Demand is forecast to strategy 320 kt within the subsequent 5 years from 175 kt in 2021; 70% of development will come from the EV sector.
Provide will preserve tempo with demand within the quick time period, nonetheless provide chain bottlenecks stay a key threat. Freight routes had been anticipated to start to normalize from the second half of 2022, however it will seemingly be delayed because of impacts from the struggle in Ukraine and Covid-19 lockdowns in China.
From 2024, the market is forecast to shift again right into a deficit as provide development fails to maintain tempo with demand. Costs will stay elevated to incentivize additional funding and forestall broad deficits creating.
Securing entry to uncooked supplies is essential if the world is to attain the sustainable and simply transition to a greener future. Cobalt’s function in batteries and recycling makes it one of many important supplies of a climate-neutral future.
—David Brocas, Head Cobalt Dealer at Glencore and Chairman of the Cobalt Institute’s Government Committee
