The DRC will remain the key global supplier of cobalt concentrates and intermediates for the forseeable future. The country is by far the world’s largest producer of cobalt, having produced 95kt in 2020 (68% of global production), and holds more than half of the world’s reserves of cobalt, says Fitch Solutions
Glencore(accounting for 29% of DRC production in 2020, all from the Katanga mine) is the main cobalt producer in the DRC, with interests in the Katanga and Mutanda mines. Katanga is set to become the world’s top producer of cobalt, while Mutanda (accounted for almost 20% of global production whilst operational), which was put on care and maintenance in 2019, is expected to be brought back online in 2022 due to the acceleration in battery demand and pick up in cobalt prices.
The second-largest producer in the DRC is China Molybdenum, which operates the Tenke Fungurume mine (accounting for 17% of DRC production in 2020). In September 2021, China Molybdenum announced it is investing more than USD2.5bn to double production at the Tenke Fungurume mine, with trial production for a separate expansion at Tenke Fungurume having already started. The company expects cobalt production at the mine to double to 34ktpa by 2023.
In third place is ERG, with most cobalt coming from the Metalkol Roan Tailings Reclamation (RTR) project (11% of DRC production in 2020).
Other smaller operations in the DRC produced the remaining supply in 2020, together with an estimated 8.5kt (9% of DRC production) from artisanal and small-scale (ASM) miners. The ASM sector holds an important role in the DRC’s mining industry, and in 2020 the government set up a new state-owned company, Entreprise Générale du Cobalt (EGC), which is a wholly-owned subsidiary of state-owned Gécamines, to formalise the ASM sector.
In July 2021, reports alleged that the Congolese government through EGC will begin buying cobalt from artisanal miners within two months. The EGC holds monopoly rights to the purchase and sale of artisanal cobalt in the DRC. In November 2020, Trafigura reached an agreement with EGC to finance as many as six strictly-regulated artisanal mining sites.
Cobalt from the artisanal sites will feature QR tracing, in an attempt to ensure the cobalt supply chain is more transparent and that the cobalt on international markets is procured in a safe and ethical manner free of child labour.