Sinolytics Radar
Last update: May 17, 2023
China dominates global cobalt production
- The Democratic Republic of the Congo accounts for 73 percent of global cobalt extraction. Chinese firms such as Chengtun Mining, China Molybdenum, CMOC, Wanbao and Jinchuan own 15 of the 19 cobalt mining assets in DR Congo. This includes some of the largest mines in the world like Tenke Fungurume and Sicomines. These two mines alone account for 20 percent of global cobalt extraction.
- About 80 percent of Congo's cobalt is shipped to China, via the South African port of Durban or other routes such as Mozambique.
- China accounts for 76 percent of global refined cobalt production. For chemical refining used for batteries, the amount is even higher, at 91 percent of global production. Huayou Cobalt is the largest refiner, with a production of more than 38,000 t (metal) of cobalt. Other large refiners include CMOC, Jinling, and GEM.
- Chinese companies also increasingly seize opportunities beyond DR Congo. For instance, Chinese firms help boosting cobalt extraction and build up refinery capacity in Indonesia.
- Non-Chinese cobalt supply chains exist, but they are few. For instance, Glencore‘s KCC and Mutanda mines in DRC Congo supply cobalt hydroxides to Umicore‘s cobalt refinery in Finland. BMW sources cobalt solely from mines in Morocco and Australia.
- However, China's involvement in DR Congo also faces challenges. President Tshisekedi and Premier Lukonde led a review of Chinese mining contracts and exports from the Tenke Fungurume mine were suspended in 2021. CMOC was accused by Congolese officials and its partner Gecamines to underreport reserves and more generally for China of not meeting its infrastructure investment promises. In April 2023, however, CMOC and Congo resolved the issue, freeing up a stockpile of 16,000t cobalt hydroxide.
Sinolytics is a European consulting and analysis company specializing in China. It advises European companies on their strategic orientation and concrete business activities in the People's Republic.