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Cobalt, Critical, Strategic and Rare Earth Minerals and Metals

How Congo faced down some of the world’s biggest mining firms – by Aaron Ross (Reuters U.K. – March 15, 2018)

https://uk.reuters.com/

DAKAR (Reuters) – In an ornate room in Democratic Republic of Congo’s presidential palace last week, some of global mining’s most powerful men faced off against government officials over proposed changes to the country’s mining code.

Facing the officials, including President Joseph Kabila, the executives at times threatened to pursue arbitration or close mines if the government went ahead with changes including royalty increases, according to one of the president’s top advisers, Barnabe Kikaya bin Karubi, who attended the meeting.

But there was no mistaking the sense of defeat as executives from Glencore, Randgold, Ivanhoe and other firms descended the red carpeted stairs after six hours to accept before the media a mining code that hikes taxes and removes exemptions for cobalt and other minerals.

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First Cobalt Buys Idaho Explorer in Race to Supply Battery Boom – by Danielle Bochove (Bloomberg News – March 14, 2018)

https://www.bloomberg.com/

First Cobalt Corp. is seeking to speed up its timetable to begin producing cobalt, riding the wave of interest in the metal used in electric-vehicle batteries and smartphones.

The Vancouver-based exploration company agreed to buy explorer US Cobalt Inc., which has properties in Idaho, in an all-stock deal with an implied equity value of about C$149.9 million ($116 million). Trading in the two companies’ shares was suspended.

“We’re trying to fast-track our way into North American mining and refining,” First Cobalt Chief Executive Officer Trent Mell said in an interview.

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This Commodity Investor Is Hoarding the World’s Cobalt Supply – by Mark Burton (Bloomberg News – March 13, 2018)

https://www.bloomberg.com/

Backed by a Russian billionaire, Anthony Milewski started stockpiling the metal in 2015.

Anthony Milewski was among the first investors to realize that if electric-vehicle sales take off the way automakers expect, the world is going to need a lot more cobalt—an essential ingredient in lithium-ion batteries.

But the market for cobalt isn’t very big, and there aren’t many easy ways for investors to bet on prices. The metal is a minor byproduct of copper and nickel mining, and only a few places produce meaningful quantities. More than half the world’s supply comes from the Democratic Republic of Congo, an impoverished country in central Africa mired in corruption scandals and political unrest.

So, in 2015, backed by a Russian billionaire, Milewski started buying metal from mining companies and putting it in warehouses. At the time, it was cheap because most industrial commodities were stuck in long slumps.

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Taxes Aren’t the Real Problem With Congo Mining – by David Fickling (Bloomberg News – March 12, 2018)

https://www.bloomberg.com/

Royalties are still low after an increase. The cost burden lies elsewhere.

There’s a strange thing about the fear going through the global mining industry after the Democratic Republic of Congo signed an order to lift royalties last week: Compared with most other countries, these levies are still relatively low.

The existing 2 percent rate on copper extraction compares with royalties five times that level in Chile and Peru, the two biggest producers.

Even at the new 3.5 percent rate proposed by the country’s national assembly, charges will still be lower than those paid in Australia and the U.S., according to a PricewaterhouseCoopers database of copper royalties. (There’ll be an additional levy on windfall profits, too — but the history of those taxes suggests little money will be raised, anyway.) So what’s the fuss about?

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Battery builders get the cobalt blues – by Anthony King (Chemistry World – March 12, 2018)

https://www.chemistryworld.com/

Demand for battery metals surges on the back of a global appetite for electric vehicles

At the beginning of 2017, $32,500 (£26,300) would buy you one tonne of cobalt. Today you’d have to fork out $81,000. Since 2016, cobalt’s price has spiked enormously, and it’s all because of batteries.

Cobalt is an essential component of the lithium ion batteries that power our phones and laptops, and which are expected to be a key part of the world’s energy mix. ‘In 2017, we saw demand from the battery sector at 102 GWh, but we expect that to increase to 709 gigawatt hours by 2026,’ says Caspar Rawles, market analyst at Benchmark Minerals Intelligence.

That demand comes from consumer electronics and using batteries as grid storage for renewable energy sources. But by far the biggest driver is electric vehicles, with governments around the world looking to make the switch from petrol and diesel.

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Cobalt: The Achilles Heel for Electric Car Makers – by Tim Treadgold (Forbes Magazine – March 7, 2018)

https://www.forbes.com/

Fueling future generations of electric vehicles is making some mining entrepreneurs rich as demand grows for critical metals, such as lithium and cobalt. But as with all commodity booms, there are early signs of a shortage turning into a flood, with a predictably depressing effect on prices.

Lithium is the metal most likely to be hit by a surge in production and a fall in price, especially if demand for electric cars does not match optimistic forecasts.

Ironically, it could be a shortage of cobalt that delays the production of the lithium-ion batteries needed to power electric cars and a range of other products, such as smartphones and household appliances.

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The Oligarchs’ Feud That Will Affect Electric Cars – by Yuliya Fedorinova (Bloomberg News – March 5, 2018)

https://www.bloomberg.com/

Russian billionaires are feuding over control of a giant natural-resource business that dates back to the Soviet era. So far, so Russia.

What makes the battle for MMC Norilsk Nickel PJSC more important than typical business maneuvering is that it will affect development of one of the largest deposits of nickel and cobalt, which are used in batteries for goods including iPads and Tesla cars.

1. Who is feuding?

Vladimir Potanin and Oleg Deripaska, the two billionaires battling for control of Nornickel (as the company is known), have opposing strategies for its future. Potanin, the company’s chief executive officer and the second-richest Russian, wants to expand the business and develop new deposits to maintain its position in the industry.

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CBS News finds children mining cobalt for batteries in the Congo (CBS News – March 5, 2018)

https://www.cbsnews.com/

A CBS News investigation has found child labor being used in the dangerous mining of cobalt in the Democratic Republic of Congo. The mineral cobalt is used in virtually all batteries in common devices, including cellphones, laptops and even electric vehicles.

A report by Amnesty International first revealed that cobalt mined by children was ending up in products from several companies, including Apple, Microsoft, Tesla and Samsung.

CBS News traveled to the DRC to follow the complex supply chain. As CBS News correspondent Debora Patta reports, it’s been two years since that damning Amnesty report was published, but the DRC is a country embattled in conflict, and it is difficult and sometimes dangerous to report from there.

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Congo says will campaign to prevent child labor in cobalt mines (Reuters U.S. – March 1, 2018)

https://www.reuters.com/

LONDON (Reuters) – The Democratic Republic of Congo will launch this month new monitoring and tracing mechanisms to tackle child labor in cobalt and copper production, a mines ministry official said on Thursday.

Sourcing of the metals has come into focus as manufacturers scramble to secure supplies of cobalt, a key component in rechargeable lithium-ion batteries, as production of electric cars surges.

Congo is by far the world’s biggest producer of cobalt, accounting for more than half of global supply. But rights groups say child labor is used to produce some of that cobalt. Amnesty International calculates a fifth of the country’s cobalt output is mined by hand by informal miners, including children.

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The World’s Cobalt Supply Is In Jeopardy – by Frank Holmes (Forbes Magazine – February 27, 2018)

https://www.forbes.com/

Disney’s Black Panther is in theaters right now, breaking all kinds of box office records and wowing audiences. The film features a fictional, highly-advanced African country known as Wakanda, whose vast wealth and prosperity are derived almost exclusively from the mining of a rare, fantastical metal called vibranium.

In its own colorful way, Black Panther does an excellent job dramatizing mining’s important role in supplying the world with much-needed raw materials. Vibranium is the basis for everything in the film, from the title character’s flashy superhero suit to Wakanda’s otherworldly infrastructure and vehicles, to its futuristic medicine and weaponry.

Like Wakanda, the real Africa is rich in minerals and metals, many of them extremely valuable. Think platinum and palladium in South Africa, diamonds in Botswana, copper in Zambia and cobalt in the Democratic Republic of the Congo.

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Commentary: Apple and the vertical transformation of mining – by Kurt Breede (Northern Miner – February 26, 2018)

The Northern Miner

Kurt Breede, P.Eng. is the Director of Industry Partnerships at the Lassonde Institute of Mining, University of Toronto, one of the leading mining research institutes in Canada. The views and opinions expressed in this article are those of the author.

Earlier this month, Bloomberg reported that Apple Inc. was in direct talks with an undisclosed mining company to secure long-term cobalt supplies to support the mounting demands of the company’s power hungry device lineup.

Cobalt, a hard, silver-grey metal once used for jewellery and paints, is the primary component for today’s lithium-ion batteries. Valued at over US$37 per lb. — an increase of 100% from just the year before — the metal is a coveted chalice for power hungry manufacturers seeking footholds in the ever narrowing space.

The potential deal would mark one of several negotiated by vertically integrated manufacturers (VIMs) in recent months to secure supplies of metals required to satisfy expanding production targets. BMW, Volkswagon and Samsung are just some of the industry giants rallying to align themselves with raw material producers.

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Scarce, expensive cobalt essential for electric cars – by Terry Cain (Globe and Mail – February 27, 2018)

https://www.theglobeandmail.com/

The recent market turmoil has knocked back the value of most asset classes. But one group has held up surprisingly well. After rising dramatically in 2017, certain scarce metals, such as cobalt and lithium, continue to be hot commodities. In fact, the price of cobalt has set a new record high. So what is driving this rally, can it continue, and how can investors benefit?

The key factor driving these metals is surging demand for lithium-ion batteries. These power sources are the most popular kind of rechargeable batteries used in home electronics, as well as electric vehicles. Production and sales of these batteries have taken off as global sales for these products surge.

As the name indicates, one of the key ingredients in lithium-ion batteries is lithium. The price of the silvery-white metal, sometimes called “white gold,” has spiked by nearly 500 per cent over the past five years, though it has pulled back in the first part of this year. Australia and South America are the main lithium producers.

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Pandering to electric-vehicle owners contains blind spots – by Konrad Yakabuski (Globe and Mail – February 28, 2018)

https://www.theglobeandmail.com/

Electric-vehicle sales more than doubled in Ontario in 2017 as rebates worth up to $14,000 per car propelled the province past Quebec to become Canada’s EV leader. Many electric-car fans celebrated this as proof that Ontario’s latest incentives to encourage EV sales are working.

Working for them, maybe. But what about for taxpayers and the planet? We already know that government rebates on EV purchases are a horrendously expensive way to reduce carbon. Encouraging consumers to move to smaller gasoline-powered cars by increasing sales taxes on fossil fuels would do so much more to cut emissions.

What’s more, it is now becoming clear that mining the massive amounts of cobalt and lithium needed to manufacture the bigger batteries required to increase EV range and reliability risks creating a slew of unintended social, economic and environmental consequences.

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‘Boring’ Gold Giants Struggle to Compete With Hot Battery Metals – by Danielle Bochove (Bloomberg News – February 28, 2018)

https://www.bloomberg.com/

Gold producers are doing everything they’re supposed to be doing — squeezing more profit out of mines, penny-pinching on projects and resisting the kind of big deals that got them into trouble when prices fell.

While that’s satisfying their large institutional shareholders, it’s not enough to lure more general investors drawn to flashier electric-vehicle commodities, as well as to stocks riding the marijuana and cryptocurrency booms.

Large producers such as Barrick Gold Corp. and Goldcorp Inc. surged in 2016 as they emerged from a painful multi-year downturn. Since then, they’ve largely decoupled from bullion, which has continued to rise, and are trading at the cheapest versus the Dow Jones Industrial Average in more than a year.

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Agnico Eagle Is Reviewing Cobalt Assets After Receiving Interest – by Danielle Bochove and Susanne Barton (Bloomberg News – February 26, 2018)

https://www.bloomberg.com/

Agnico Eagle Mines Ltd. is dusting off cobalt assets in Ontario for potential sale as a global search for the rechargeable-battery ingredient expands amid surging demand.

The gold producer is doing an analysis of its Canadian cobalt holdings after receiving five or six inquiries, Chief Executive Officer Sean Boyd said Monday in a Bloomberg TV interview at the annual BMO mining conference in Florida.

The move comes at a time when manufacturers are seeking to secure cobalt on behalf of battery makers as demand heats up from the electric-vehicle and mobile-phone industries.

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