The Democratic Republic of Congo, the world’s top cobalt supplier, has extended a ban on cobalt exports for three months to curb oversupply and stabilize prices.
The ban, initially imposed in February for four months after prices hit a nine-year low of $10 per pound, was set to expire but will now continue until September.
The Authority for the Regulation and Control of Strategic Mineral Substances’ Markets (ARECOMS) cited continued high stock levels in the market as the reason for the extension.
ARECOMS plans to review the situation and may modify, extend, or terminate the suspension before the new deadline.
Major mining companies have differing views on the ban.
Glencore, the world’s second-largest cobalt producer, supports implementing quotas to manage supply, while China’s CMOC Group, the largest producer, has lobbied for the ban to be lifted.
The cobalt market has faced supply surplus pressure, significantly impacting the DRC’s fiscal revenue and global cobalt smelters’ profitability. The export ban aims to digest excess inventory and boost cobalt prices.
However, the fundamental issue of supply surplus remains unresolved, and the ban’s extension may lead to supply chain restructuring and impact global cobalt prices.
